[2019-09-05] Fewer People Are Sending Bitcoin to Largest Crypto Exchanges

1Referee

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Quote from: Harlot on September 14, 2019, 03:01:58 PM

I personally don't use inflow/outflow since we already have volume as an indicator on whether or not the buy side or sell side is winning in every candle. This is the most basic indicator to see if there is really a massive selling going on. But you are right the indicator you have mentioned only tells that there is still a considerable amount of hodling going on. Plus it's obvious why there is no considerable amount of money entering in the market, we are neither in a bullish nor bearish market as we are in a consolidation stage and really this is not the most appealing time to buy more position if you are looking for value for your money.

Volume is quite a tricky indicator in my opinion. Even on the more reputable exchanges (i.e. Bitstamp, Coinbase, Kraken) there is clear wash trading happening. Whales tend to legitimately sell or buy x amount of coins, then after that sell or buy into their own orders to even out the ratio between buys and sells to make it appear there is no specific sentiment bias.

The fact that more coins are being deposited on an exchange than withdrawn is more telling. People are selling and/or are preparing to sell.

Harlot

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Quote from: 1Referee on September 14, 2019, 10:55:49 AM

I found this useful site that shows you how much capital inflow/outflow there was; https://www.tokenanalyst.io/exchange/BTC/Bitstamp

In the last couple of months the inflow (which means how many coins people sent to Bitstamp) has consistently been higher than what people withdrew. This pretty much shows that while perhaps fewer people are sending coins to an exchange, the actual amounts sent to Bitstamp are large enough to dwarf those who withdraw their coins.

It basically means that smart money is selling and not buying, which explains why we are trending down. Exchanges such as Bitmex and Bitfinex experienced more outflow than inflow, but that's not surprising either given their problems.

There is also and inflow/outflow indicator in the charts of tradingview but the catch is you have to sign up and create an account to use it because it's not one of those basic indicators. I personally don't use inflow/outflow since we already have volume as an indicator on whether or not the buy side or sell side is winning in every candle. This is the most basic indicator to see if there is really a massive selling going on. But you are right the indicator you have mentioned only tells that there is still a considerable amount of hodling going on. Plus it's obvious why there is no considerable amount of money entering in the market, we are neither in a bullish nor bearish market as we are in a consolidation stage and really this is not the most appealing time to buy more position if you are looking for value for your money.

1Referee

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I found this useful site that shows you how much capital inflow/outflow there was; https://www.tokenanalyst.io/exchange/BTC/Bitstamp

In the last couple of months the inflow (which means how many coins people sent to Bitstamp) has consistently been higher than what people withdrew. This pretty much shows that while perhaps fewer people are sending coins to an exchange, the actual amounts sent to Bitstamp are large enough to dwarf those who withdraw their coins.

It basically means that smart money is selling and not buying, which explains why we are trending down. Exchanges such as Bitmex and Bitfinex experienced more outflow than inflow, but that's not surprising either given their problems.

1BTC EQUALS 1CAR

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It's not suprising when we all know that 2018 was the year where everyone got hit with the hardest crash in the history of crypto. Or some people might be just continuing to hold their bitcoin and like their forgot about their existence and they will only withdraw it when we hit another new all time high. And another thing is that I think 2017 is record-breaking year for bitcoin transactions so we cannot assume that fewer people are sending bitcoin because it might be just like the normal which are the last few years before 2017.

Kakmakr

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I think a lot of this has to do with people rather hoarding their coins than having to risk trading them and losing money. After 2017 the price dropped with more than 80%, so people would rather keep their coins in their wallets than selling it at a lower price and hoping that the price would recover to prices larger than the price that they paid for it after the 2017 peak. Roll Eyes

Some of these exchanges has also tightened their KYC requirements and this is also a huge pain in the ass, so people would rather prefer to avoid these services and going with less known exchanges without all this "red tape". Wink

BitHodler

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Quote from: bryant.coleman on September 08, 2019, 07:46:10 PM

There is some interesting news from the cryptocurrency market. During the past 24 hours, the Bitcoin dominance has declined from 71.2% to 69.9%. This will give some breathing room for the alts, although I am not sure how long this phase is going to last. In the long term, I don't have much hope for the vast majority of the altcoins and tokens.

What's so interesting about that? Dominance isn't longer just a metric to measure where Bitcoin stands against altcoins, but a chart that can be traded where there are resistance and support levels to pay attention to.

As with everything in a bull market, the price goes up a bit, then corrects slightly, then make a higher high, correct, etc. Bitcoin's dominance is no exception in that regard-- the trend continues until the market dynamics hint at a reversal.

Overall, altcoins have never really added anything of value in terms of utility, but they have gone through the roof nonetheless. Once Bitcoin profits are taken, the most likely route are altcoins to maximize profits even further.

veleten

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its a strange logics , if less people are sending coins to the top exchanges it doesn't mean that the interest is lower
it means exactly that - less unique addresses are connected to the known addresses of the "top exchanges"
there are many exchanges in the world , by the way and hope the researchers are aware that neither Bitfinex nor Bitstamp are top exchanges if we trust this chart:

https://coinmarketcap.com/rankings/exchanges/

this chart includes Coinbase , by the way but the figures are definitely off

https://data.bitcoinity.org/markets/volume/30d?c=e&t=b

and people tend to be conservative and many choose convenience vs privacy and security and reuse their addresses
there is no stats as to how many "old" addresses are being used and only tracking some , not all of the "new" addresses
cannot be a metrics to draw any conclusion from , too many unknowns

bryant.coleman

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Quote from: asajapheth on September 08, 2019, 05:36:18 PM

I think the shift of attention from major exchanges is a good thing. It would make it easier for smaller exchanges to grow, and in particular for DEXs to be used more. That would also mean that there may not be much sell orders as compared to previous times. A bull run might just be lurking.

The OP was hinting that trade volume across the exchanges were falling, and smaller exchanges and DEX sites are no exception. The declining prices of altcoins means that fewer and fewer traders are converting their BTC to altcoins or trading with them. Also, BTC exchange rates are rising and therefore less number of users are converting their crypto to USDT.

There is some interesting news from the cryptocurrency market. During the past 24 hours, the Bitcoin dominance has declined from 71.2% to 69.9%. This will give some breathing room for the alts, although I am not sure how long this phase is going to last. In the long term, I don't have much hope for the vast majority of the altcoins and tokens.

asajapheth

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I think the shift of attention from major exchanges is a good thing. It would make it easier for smaller exchanges to grow, and in particular for DEXs to be used more. That would also mean that there may not be much sell orders as compared to previous times. A bull run might just be lurking.

malevolent

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Quote from: stompix on September 08, 2019, 04:24:16 PM

Hihi, I live in Europe Cheesy

The thing with the can find is, unfortunately, a bit more problematic.
As you can see coin radar shows a lot of 4.9% fees and sometimes even some pretty tempting 2% which, unfortunately, are not always true as you get one fee listed on the website and when you reach the ATM you will see another thing, I personally had a really bad experience with one of the biggest ATM operators around here so I won't use their ATMs ever again
Also on that website, I have close to 30 ATMs near me, in 3 countries, lol, as I live near the border and only 2 of them show a fee lower than 5%.

Besides, I really don't think is about the AML and more about the cost of the ATM, like rent and others and their greed.

Well, at least the ones in Poland often do usually charge less than 5%, even after increases in fees of two major ATM operators.

AML of course is going to increase costs of doing business, KYC-capable ATMs are more expensive, and the operator has to pay an external company to deal with the KYC if they don't want to spend resources on doing it themselves.

stompix

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Quote from: malevolent on September 07, 2019, 04:16:24 PM

Quote from: stompix on September 05, 2019, 03:54:19 PM

No, just no.
DEXs maybe but ATMs no, simply no. With 5% (if you're lucky) to 15% fees, nobody will sell more than a couple of mbits via those.
We're talking about people sending coins, that usually means for selling, so people who have bought them, hodl them for a while and that know how much they've paid in fees when they bought and how much those should be, not some noobs trying an atm for the first time.

Not true, you're just looking at countries with an oppressive AML regime making it more expensive to run Bitcoin ATMs. In Europe you can find ATMs selling/buying bitcoins for a 2-3% fee.

Hihi, I live in Europe Cheesy

The thing with the can find is, unfortunately, a bit more problematic.
As you can see coin radar shows a lot of 4.9% fees and sometimes even some pretty tempting 2% which, unfortunately, are not always true as you get one fee listed on the website and when you reach the ATM you will see another thing, I personally had a really bad experience with one of the biggest ATM operators around here so I won't use their ATMs ever again
Also on that website, I have close to 30 ATMs near me, in 3 countries, lol, as I live near the border and only 2 of them show a fee lower than 5%.

Besides, I really don't think is about the AML and more about the cost of the ATM, like rent and others and their greed.

malevolent

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Quote from: stompix on September 05, 2019, 03:54:19 PM

No, just no.
DEXs maybe but ATMs no, simply no. With 5% (if you're lucky) to 15% fees, nobody will sell more than a couple of mbits via those.
We're talking about people sending coins, that usually means for selling, so people who have bought them, hodl them for a while and that know how much they've paid in fees when they bought and how much those should be, not some noobs trying an atm for the first time.

Not true, you're just looking at countries with an oppressive AML regime making it more expensive to run Bitcoin ATMs. In Europe you can find ATMs selling/buying bitcoins for a 2-3% fee.

NeuroticFish

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Address reuse is still big and may not help in these statistics.
Always the number of trades is bigger in the FOMO period; clearly since then the things have cooled down greatly.
Binance was new and the speculators and arbitrage traders were still going there, setting up, using new addresses; now they're set and may not need new things.

OK, it's clearly a decrease. But I am sure that the numbers are not as accurate as they want us to believe; and to be fair, we have to compare the numbers FOMO against FOMO, cool down vs cool down. And clearly not jump to conclusions like there would be a decrease in interest.

davis196

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Not all bitcoin users are crypto traders with accounts in the top 5 cryptocurrency exchange platforms. Grin

It' not a secret that bitcoin adoption(and crypto adoption in general) are extremely slow.
This years BTC price pump from 4K to 11K USD was funded mostly by the retreat from altcoins.That's why the bitcoin dominance has increased.

o_e_l_e_o

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Quote from: stompix on September 05, 2019, 03:54:19 PM

DEXs maybe but ATMs no, simply no. With 5% (if you're lucky) to 15% fees, nobody will sell more than a couple of mbits via those.

Those were just examples. There are sites like LBC and Paxful, more and more OTC options, and so on. There is less dependence on centralized exchanges as these options grow. I would also rather pay a 5% ATM fee than give away my documents to any exchange. People really undervalue their privacy these days, or how horrendous identity theft can be.

Quote from: 1Referee on September 05, 2019, 04:41:40 PM

Quote from: hatshepsut93 on September 05, 2019, 03:00:05 PM

they should have looked at metrics like new account registrations per month and fiat deposits, though this data is only available only to exchanges.

Registrations as metric is just as flawed as volumes and whatnot.

Any metric coming from an exchange will be flawed - they all artificially inflate their numbers to make them seem like a bigger player than they are. The numbers that we can chart accurately - such as hash rate or transactions per day - are showing a steady increase.

Quote from: bryant.coleman on September 05, 2019, 09:58:25 PM

The exchange volumes are down because the altcoins are decimated and the users are no longer spending their Bitcoins to purchase worthless shitcoins.

It's been a while since I scrolled down on Coinmarketcap, but the volumes being trade for some altcoins are hilariously low. There are quite a few with daily volumes of only a few million, and there's one called Bytecoin at position 57 with a daily volume of only $13k. Glad to see a bunch of these worthless altcoins dying off.

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Quote from: BitHodler on September 06, 2019, 01:23:10 PM

Smart traders and investors have sold their altcoins to Bitcoin the moment critical support levels were broken, while the yolo get rich quick noobs think it's a good thing to show how tough they are by hodling them.

This is a mistake that I did earlier in 2013, when I was new to the cryptocurrency sector. I invested in a few shitcoins such as Quark, Ixcoin.etc and they went down by more than 90% in the next few months. I continued to hold on to them, hoping that one day they'll make a recovery and I will get my capital back. That didn't happened and eventually these coins became dormant.

What I had learned from these incidents is that if a smaller altcoin (i.e those outside the top-20 list in coinmarketcap) goes down continuously for more than 6 months, then there is no point in holding it. An exception can be made if it shows a stable trade volume (as it indicates that some demand is there). After 3-6 months, you need to sell the coin at whatever prices available, to prevent complete losses.

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Quote from: bryant.coleman on September 05, 2019, 09:58:25 PM

See how these guys are twisting the news. The exchange volumes are down because the altcoins are decimated and the users are no longer spending their Bitcoins to purchase worthless shitcoins. And in most cases those who had altcoins have already converted them to either BTC or USDT. In just 4 months, the altcoin market share (excluding the Bitcoin forks and the stablecoins such as USDT and USDC) have gone down from more than 50%, to less than 25%. No one expected such as steep fall in a very short duration.

The altcoin space seems so depressing that Binance came out and said that they expect Bitcoin's dominance to go back down to 60 or 50%. They make most of their money from altcoin trades, so this is very bad for them.

It's going to be interesting to see if altcoins will yet again face a massive selloff when Binance stops serving US residents next week. In this specific case I don't mind regulations to clean this space from all the garbage coins.

Smart traders and investors have sold their altcoins to Bitcoin the moment critical support levels were broken, while the yolo get rich quick noobs think it's a good thing to show how tough they are by hodling them.

bryant.coleman

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See how these guys are twisting the news. The exchange volumes are down because the altcoins are decimated and the users are no longer spending their Bitcoins to purchase worthless shitcoins. And in most cases those who had altcoins have already converted them to either BTC or USDT. In just 4 months, the altcoin market share (excluding the Bitcoin forks and the stablecoins such as USDT and USDC) have gone down from more than 50%, to less than 25%. No one expected such as steep fall in a very short duration.

And since they are not investing/trading in shitcoins, there is no point in keeping the BTC in exchanges (as it makes the coins more vulnerable to hacks and robberies). So what happened is that they simply withdrew the BTC to the online or desktop wallets. Bitcoin is looking quite strong, especially after the bull run which took the exchange rates from $3K to $10K. The decimation of the shitcoins have nothing to do with Bitcoin. They went down owing to their own failures.

1Referee

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Quote from: hatshepsut93 on September 05, 2019, 03:00:05 PM

they should have looked at metrics like new account registrations per month and fiat deposits, though this data is only available only to exchanges.

Registrations as metric is just as flawed as volumes and whatnot. I can sign up to an exchange with thousands of accounts and not complete the KYC procedure, which means that the accounts are worthless. If I can do that, an exchange can too. Exchanges that display the number of registrations do not exclude non verified accounts for obvious reasons.

Interest can be measured in stablecoins with how they are the only fiat metric we can actually trace. If we look at USDC for example, they have reached an all time high this month in the number of stablecoins they have circulating. This means that capital is still entering crypto.

Carlton Banks

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Quote from: squatter on September 05, 2019, 02:55:38 PM

I'd be curious to see the numbers for Coinbase, who I think is more representative of what new or typical users are doing.

wouldn't we all, but Coinbase are unlikely to ever release anything but the most cooked/opaque figures they can slap together

Topic: [2019-09-05] Fewer People Are Sending Bitcoin to Largest Crypto Exchanges (Read 337 times)