September has turned out to be a highly volatile month for bitcoin so far, as the asset has gone through several ups and downs, including yesterday’s impressive surge to over $58,000.
However, BTC could be on the verge of yet another rally, given the substantial outflows from exchanges, which recently hit a multi-month high.
$750M in Withdrawals
IntoTheBlock data shows that September 10 marked the highest levels of BTC withdrawals from trading platforms since May, marking a four-month peak for this metric. The declining bitcoin reserves sitting on exchanges reduce the immediate sell pressure for the asset, which is typically regarded as a bullish development.
In fact, ITB’s graph shows that the last time such a large portion of the bicoin supply was taken off trading venues (late May) was followed by a price surge that drove the asset from under $68,000 to $72,000 within days.
In contrast, the massive inflows in late July led to a price crash that pushed the cryptocurrency from over $68,000 to under $64,000. Moreover, BTC’s price tumbled further in early August, dumping to a multi-month low of under $50,000.
As such, the recent withdrawals could be a signal for even more rallies around the corner. BTC’s price already recovered from the post-CPI dump to $55,500 and now sits above $58,000 in anticipation for the upcoming FOMC meeting in the States next week.
Aside from the declining exchange reserves, the growing number of stablecoins ready to be deployed for purchases could also propel a price surge for bitcoin or some of the altcoins .
ETF Landscape
While investors pulled out the aforementioned $750 million worth of bitcoin off exchanges on September 10, that date saw $117 million in net inflows to the spot BTC ETFs. This was the highest day of net inflows since August 26.
However, the trend changed once again on September 11 as investors took out in total $43.9 million from the financial vehicles. Ark Invest’s ARKB was hit the hardest with $54 million in withdrawals, while Fidelity’s FBTC attracted $12.6 million.
