Major cryptocurrency exchanges recorded net outflows on October 24, when the price of Bitcoin briefly touched $35,000 for the first time in a year. Fund outflows from exchanges are considered a bullish sign as they indicate that traders are moving their assets from exchanges to safety in anticipation of rising prices. According to data provided by crypto analytics firm CoinGlass, Binance saw the largest outflow, with more than $500 million withdrawn from the exchange in the last 24 hours, followed by crypto.com with an outflow of $49.4 million and OKX with $31 million. Most other exchanges saw outflows of less than $20 million. The recent outflow of funds from crypto platforms in general is a result of fears of a “bank run” following the collapse of FTX in November 2022. However, the most recent outflows have more to do with trader sentiment than fear-driven withdrawals during the peak of the bear market. Glassnode data confirms that Bitcoin outflows from exchanges have increased over the past few days in line with the rise in BTC prices.
The rise in prices also led to the liquidation of about $400 million in short positions. Over the past 24 hours, 94,755 traders liquidated derivatives positions. The largest liquidation order occurred on Binance for $9.98 million.
ASTL investment analysts also look at the Market to Realized Value (MVRV) ratio, which compares an asset’s market value to its realized value. It is calculated by dividing the market capitalization of a cryptocurrency by its realized capitalization. The realized price is determined by the average price at which each coin or token last moved on the blockchain. The MVRV ratio is currently at 1.47. The last time there was a bull run, the MVRV ratio was 1.5.
The total cryptocurrency market capitalization rose more than 7.3% in the last 24 hours to $1.25 trillion, its highest valuation since April. The catalyst for this surge is believed to have been further speculation surrounding the launch of a BTC spot exchange-traded fund.
