On-chain data shows that the bitcoin exchange whale ratio increased just before the crypto dipped below the $19k level.
Bitcoin Exchange Whale Ratio Breaks 90% Just Before Price Dip
As one analyst pointed out in a Cryptoquant post, whale activity on exchanges has picked up recently.
The “Exchange Whale Ratio” is an indicator that measures the ratio between the top ten inflow transactions and the total exchange inflows for exchanges.
The ten largest transfers are thought to be from whales, so that metric tells us what portion of the total number of coins going to exchanges is coming from these humble holders.
When the value of this indicator is high, it means that a large part of the flow is coming from whales right now. Such a trend could be a sign of dumping from this group and hence bearish for the price.
On the other hand, lower values of the ratio may indicate that whales are currently making a healthy portion of the exchange’s transactions. Such a trend for the value of crypto can be either bullish or neutral.
Historically, the metric has typically had a value above 0.85 during bear markets or simulated bull runs, while it typically remains below this range during bull runs.
Now, here is a chart that shows the trend in bitcoin exchange whale ratio over the past few months:
The value of the metric seems to have been elevated recently | Source: CryptoQuant
As you can see in the above graph, the bitcoin exchange whale ratio increased yesterday and reached a value of 0.9, which means that whales contributed 90% of the flows to the exchanges.
This spike in the indicator came not long before the coin’s price plunged below $19k, indicating that dumping from whales may be behind the decline.
The ratio has also remained high since then, which could mean that the group continues to make deposits on exchanges, which could prove to be bearish for BTC.
btc price
At the time of writing, the price of bitcoin is down 4% over the past seven days, around $19.3k. In the past month, the crypto has lost 17% in value.
The chart below shows the coin’s price trend over the past five days.
Looks like the value of the crypto has rebounded back a little to above $19k again since the plunge yesterday | Source: BTCUSD on TradingView
Featured image from Karl-Heinz Müller on Unsplash.com, charts from TradingView.com, CryptoQuant.com