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Institutions continue to buy bitcoin – head of CryptoQuant
Bitcoin price continues to rise due to OTC transactions
Hidden trading can be revealed using on-chain analytics
Institutions prefer not to buy cryptocurrency directly from exchanges
Institutional Investors Continue Buying Bitcoin Despite Price Highs Through OTC Transactions
Major players are still buying bitcoin even though the 2017 high has been crossed. This is the conclusion reached by the head of the analytical resource CryptoQuant Ki Yong Joo on his Twitter page..
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He cites over-the-counter (OTC) trades to support his theory. According to the CEO of CryptoQuant, a large outflow of bitcoin from exchanges like Coinbase usually means transferring institutional cryptocurrencies to the exchange’s cold storage..
Echo of whales
Also, the head of CryptoQuant advises to monitor the coefficient of movement of exchange funds. The ratio shows the ratio of the volume of exchange transactions with operations within the blockchain itself.
If the indicator increases, it means that most of the network transactions are deposits / withdrawals from exchanges. If the price of a cryptocurrency rises sharply without on-chain activity, this could mean OTC transactions, the head of CryptoQuant notes..
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So far, as online statistics show, only 5% of network transactions are used to deposit / withdraw funds from exchanges. This happened in February 2019, when large exchanges opened OTC channels for buying / selling cryptocurrencies..
To track OTC transactions, the head of CryptoQuant recommends keeping an eye on the rate of tokens being moved across the network. If the number of transferred tokens grows, and the exchange funds flow ratio remains unchanged or falls, this means the continuation of OTC transactions..
Meanwhile, analysts at PricewaterhouseCoopers believe that the current rally is primarily due to the availability of a ready-made infrastructure for the arrival of institutional investors. According to Henry Arslanyan, head of fintech and crypto industry in the Asian region at PriceWaterhouseCoopers (PwC), the majority of large bitcoin holders regard cryptocurrency as a hedge against inflationary risks..
At the time of this writing, the price of BTC / USDT is $ 23,882.
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