Bearish signal looms: Bitcoin whales account for 91% of exchange deposits, and market panic intensifies

Over the past 24 hours, Bitcoin has stabilized. According to Bitpush terminal data, as of press time, Bitcoin was trading at about $57,827, a 2% rebound on the day. In contrast, Ethereum and BNB rebounded more than Bitcoin, rising 6.39% and 5.86% respectively.

Given that Thursday is the U.S. Thanksgiving holiday, analysts expect trading volumes to drop this week. "We have seen volatility around this holiday each of the past three years; likely due to month-end rotation, options/futures expiration, and rebalancing positions," CryptoQuant wrote in a blog post.

Bitcoin exchange whale ratio surges to 91%

Data shows that Bitcoin whales now account for 91% of exchange deposits, a trend that could be a bearish sign.

The exchange whale ratio is a Bitcoin metric defined as the total BTC volume of the top 10 transactions divided by the total number of tokens flowing into exchanges. In short, the metric represents the ratio of the top 10 transactions to total deposits entering an exchange. If the value of this ratio is high, it means that whales’ Bitcoin transactions account for a large portion of exchange deposits in a specific period, and whales are sending a large number of tokens to exchanges, which may be unfavorable for the trend of tokens. If the value of this metric is low, it means that there are not many whales currently selling on exchanges.

The chart below shows how the Bitcoin whale ratio has changed recently:

As shown in the chart, the Bitcoin whale ratio appears to have spiked early Tuesday ET, as whale transactions now account for 91% of total exchange deposits.

Typically, values ​​above 85% are seen as a sign of dumping. When BTC’s price plunged from over $66,000 about a week ago, the ratio spiked above 90% just before that. Therefore, a value of 91% could signal another dump by whales. If this trend holds, it will be another blow to the Bitcoin market, which continues to consolidate.

Since Bitcoin started to fall after hitting an all-time high of around $69,000, it has not shown any signs of rebounding. In the past week, BTC has mostly consolidated in the price range of $60,000 to $55,000, so this may suggest that the upward momentum is insufficient.

Market panic intensifies

Bitcoin’s Fear & Greed Index is at its lowest level since late September. The index shows that market participants are in “fear” mode, which some analysts see as a counter-trend sign as buyers gradually return to the market.

“Typically in bull markets, the index signals ‘greed’ or ‘extreme greed’ for longer periods of time, with short-term visits to ‘fear’ territory, like we saw this spring,” Arcane Research wrote.

It is worth noting that the current round of decline has lasted for 13 days (as of press time), and the current price is 19% lower than the ATH price. Compared with the previous declines, the magnitude of this retracement is not too large. The figure below shows that the decline in March lasted for a month and bottomed out at around 18%, while the decline in February lasted for 18 days and bottomed out at around 25%. Therefore, Bitcoin may continue to consolidate for a while before it can rise.

Author: Mary Liu

Image source: Bitpush Terminal, Twitter