Bitcoin’s price — and the broader market — started the week with one of the biggest drops it’s seen in 2024. While this broad market drop caused widespread fear and panic among crypto enthusiasts, it appears that many investors seized the opportunity to accumulate more digital assets at low prices.

According to the latest on-chain data, significant amounts of Bitcoin have been moving out of cryptocurrency exchanges. The question here is: what does this mean and how does it affect the BTC price?

Do investors expect the bull market to continue?

According to recent data from IntoTheBlock, over 28,000 BTC (worth over $1.7 billion) have been transferred from crypto exchanges in the past week. This on-chain revelation is based on changes in the Netflows metric, which monitors the amount of a given cryptocurrency being sent in and out of centralized exchanges.

An increase in the value of Netflows (or when it is positive) indicates that more funds are entering crypto exchanges than leaving them. On the other hand, when the value of the metric decreases, it means that more crypto assets are flowing out than into trading venues.

Source: IntoTheBlock

As shown in the chart above, the Netflows metric for Bitcoin has been declining over the past few days, implying that large investors have been shifting their assets away from centralized exchanges. According to IntoTheBlock, the $1.7 billion worth of BTC withdrawn over the past seven days is the largest outflow seen in this timeframe so far in 2024.

While it’s difficult to pinpoint the reasoning behind this massive exodus, crypto movements of this magnitude away from centralized exchanges typically signal a shift in investor sentiment. It suggests a change in holding strategy or even new accumulation by large investors, demonstrating their confidence in Bitcoin’s long-term promise.

Furthermore, the decrease in the availability of the leading cryptocurrency on trading platforms could result in a supply shortage. Ultimately, this decrease in BTC’s exchange reserve could cause a rise in Bitcoin price.

Bitcoin Price at a Glance

After a sharp drop from over $64,000 to $48,000 on Monday, August 5, Bitcoin’s price has shown great resilience over the past week, rebounding back above the $62,000 level.

At the time of writing, the leading cryptocurrency is trading at around $60,400, reflecting a 1% price drop over the past 24 hours. Meanwhile, data from CoinGecko shows that BTC is still down over 3% this week.

The price of Bitcoin hovering around the $60,000 mark on the daily timeframe | Source: BTCUSDT chart on TradingView

Main image from iStock, chart from TradingView