When the Bitcoin network notes a substantial increase in the median transaction volume, there is room for some concern. That increase can be caused by many factors, including exchanges, miners, etc. In this case, it seems more BTC liquidity is making its way to trading platforms again, which may end the current price run.
Bitcoin Median Transaction Volume Is Rising
It doesn’t happen all that often that there is a long-term decline in the Bitcoin median transaction volume. This is because Satoshi Nakamoto designed the network as a per-to-peer currency solution. As such, users need to keep transferring and spending Bitcoin to live up to that outlook. More often than not, there will be temporary lulls in the overall transaction activity before things start picking up once again.
The recent increase in Bitcoin median transaction volume comes at a crucial time.. The world’s leading cryptocurrency is finally showing bullish momentum again. Unfortunately, it appears this increase in network activity may put that uptrend to an end for the time being. An increase in TX volume usually means more money is flowing to exchanges.
That increase can come from individual users, miners, or large institutions alike. As the current Bitcoin median transaction volume is at a monthly high, there is no reason to panic. The volume is $801.45, which will not make much of a difference compared to the prior numbers. Even so, every notable increase is worth paying attention to. Increasing network activity is often counterproductive for current price momentum.
Unless the Bitcoin median transaction volume keeps rising, the current situation won’t change much. It is essential to figure out what is going on and why this is happening in the first place. Whether it is users, miners, or institutions moving money across the network makes a huge difference. Moreover, this doesn’t always result in more BTC liquidity moving to exchanges either.
More Bitcoin on Exchanges
Unfortunately, this appears to be a case where more liquidity is moving to centralized trading platforms. Statistics by Viewbase confirm there is an influx of over 3.200 BTC in the past week. Not the biggest amount in history, but still a positive netflow capable of suppressing any further BTC price momentum.
What is even more problematic is how there is very little interest in withdrawing BTC from exchanges. More specifically, the most significant negative netflow per platform is 1.624 BTC in a week. Conversely, the most significant influx is 4,681 BTC. Although things can still turn around on a dime, those statistics do not favor a further supply shock for Bitcoin. The future price impact remains uncertain, but it appears that bearish pressure or a status quo is the likely outcome.