- Recent on-chain data is showing a significant increase in Bitcoin transfers
- The CEO of CryptoQuant said this is a historically bullish sign for Bitcoin
- The on-chain analyst believes the increase in volume is due to a resurgence in OTC deals
Bitcoin News Today – According to a recent on-chain data, there is a considerable rise in the Bitcoin transfers. This suggests that there might be an increase in over-the-counter Bitcoin orders. Ki Young-Ju – the CEO of CryptoQuant – said that over-the-counter Bitcoin deals might be happening in a way that is similar to the pattern in February last year.
The on-chain analyst said that this is historically a bullish sign but the CEO of CryptoQuant is warning that the pattern is not absolute and should not be depended on in isolation.
Bitcoin (BTC) Price Today – BTC / USD
Bitcoin Transfers Achieved a New Yearly High
The CEO also noted that the number of BTC transfers just got to a new yearly high, adding that most of the transactions did not come from trading platforms. He said that the new highs could be as a result of a resurgence of over-the-counter volume, based on two on-chain metrics. Ki said:
“The number of BTC transferred hits the year-high and those TXs are not from exchanges. Fund Flow Ratio of all exchanges hits the year-low. Something is happening. Possibly OTC deals. This also happened in Feb 2019, when OTC volume was skyrocketed. I think this is a strong bullish signal.”
Miners and individual buyers with high net worth usually sell or buy BTC in the over-the-counter market. This allows the digital currency to move from one person to another without placing enormous pressure on the exchange market.
CTO of Glassnode Believes Otherwise
The chief technology officer of Glassnode – Rafael Schultze-Kraft – said that the increase in the volume is not Bitcoin changing hands. Rather, the analyst noted that the volume is flat and it represents “change BTC.” In a post, he said:
“Bitcoin on-chain volume is NOT increasing or hitting any highs. Even by applying the most basic change-adjustments uncovers that the increase in volume is just “obvious change” moving back to the sender. This is not $BTC changing hands, and not real economic throughput… Just wanted to point out that this is not the case, volume is in fact flat – these are just huge amounts of change BTC.”
Instead of over-the-charger deals, it could mean internal transfers or other types of internal wallet movements. If that is the case, it would not necessarily be a bullish trend for the digital currency in the short-term. However, Ki still believes they are OTC deals, adding:
“The point is just the non-exchange / non-miner entities are moving their funds by evoking multiple transactions, OTC tx is just one of the possibilities.”