Exchanges’ fund flow ratio casts the spotlight on whale behavior after selling pressure sends BTC/USD below $9,000.
Bitcoin (BTC) whales tend to dump large amounts of BTC on the market when exchanges are quiet in order to get attention.
That was the conclusion from Ki Young Ju, CEO of on-chain analysis provider CryptoQuant, who eyed the latest Bitcoin price trend on June 16.
“Fund flow ratio” shows clear Bitcoin price pattern
According to Ki, a long-term correlation between exchange usage of the Bitcoin network and price performance says a lot about whale behavior.
The metric, fund flow ratio, shows how much of the Bitcoin sent on-chain involves exchanges.
Fund flow ratio implies that the more exchanges use the Bitcoin blockchain, the higher the price is.
Ki highlighted activity in March, when BTC/USD quickly fell to lows of $3,600, as an episode which corroborates the theory.
“On March 13, network usage for deposits and withdrawals on all exchanges hit 24% and continued to decline,” he noted.
Using CryptoQuant data, March 13 showed a BTC/USD price of $5,611 and a fund flow ratio of 0.24.