Bitcoin (BTC) stashed in wallets tied to centralized cryptocurrency exchanges is rising at the fastest pace since May, hinting at a potential bull pause in the market.
Blockchain analytics firm Glassnode's bitcoin exchange net position change metric, which measures the number of coins held by exchange wallets on a specific date compared to the same date four weeks ago, rose to 31,382.43 BTC ($1.16 billion) on Sunday, the highest since May 11, 2023. That has lifted the total balance held on exchanges to 2.35 million BTC.
An inflow into exchange wallets is widely taken to represent investors' intention to liquidate their holdings, a potential selling pressure, or deploy coins as a margin in futures and options markets. Meanwhile, an outflow represents accumulation.
The BTC exchange net position change has been consistently positive since Nov. 1. Historically, such periods have coincided with bull market breathers or price pullbacks.
That said, the latest inflow could also signify renewed investor confidence in centralized exchanges.
The safety of coins held in exchange wallets came into question late last year after Sam Bankman Fried's FTX exchange collapsed, which, at the time, was the third largest. That saw investors move coins off exchanges and into their direct custody.
The leading cryptocurrency by market value has gained 7.5% this month, extending October's 28% rise, CoinDesk data show.
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