$2B of Ether being deposited to exchanges. Should we be concerned?

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Santrends
Aug 24, 2021

Assets covered: Ethereum (ETH)

Metrics used: Exchange Inflow, Exchange Outflow, Active Addresses, Average Fees

Charts layout: https://app.santiment.net/s/I0WF69b2


Tuesday uncovered an outstanding exchange inflow spike both in ETH and BTC.

What could we prepare for?



Exchange Inflow


Here's how we see ETH flow into exchanges:

Source: Sanbase

A strong spike on the right suggesting billions of dollars in Ether being deposited to exchanges.


Same thing happened to BTC:

Source: Sanbase

Exchange flow balance for both coins is up too, so the amount of BTC and ETH in/out of exchanges is substantially in the favor of coins 'in'.


If you take a look at top transactions for ETH the most likely culprit is this address - https://app.santiment.net/s/Zk0usRYJ

Sent 600,000 ETH to Binance. Last acquired ETH on July 2nd at ~$2k. So huge that it breaks overall ETH exchange flow charts:

Source: Sanbase

Based on its behavior so far, it doesn't look like an undiscovered exchange wallet (https://etherscan.io/address/0xdee6238780f98c0ca2c2c28453149bea49a3abc9). Judging by on-chain data it might be a whale possibly looking to take some profits.


This is certainly a concerning signal: whoever is sending money to exchanges seems to be doing a significant profit.


Previous similar spikes in profit taking sometimes have coincided with local price tops.



Active Addresses and fees


By the way active addresses for Ether are not great. May be because of the fees.

Source: Sanbase

Fees are picking up, active addresses are going down. Getting expensive to interact.

Perhaps it's one of the reasons why we see a divergence between fees and active addresses. Based on previous behavior we should assume that the addresses are going to decline a little bit.

So we've got a few concerning signals: exchange inflow, address activity fairly low. May be there are some people starting to take profits and you should at least be careful.



Disclaimer: The opinions expressed in the post are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.

ETHBTC
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Santrends
Aug 24, 2021

Thanks for reading!

If you enjoyed this insight please leave a like, join discussion in the comments and share it with your friends!

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Assets from this insight

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Conversations (16)

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<email hidden>

25 days ago

Hi Mohsin here

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<email hidden>

25 days ago

THANKS

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Baris Parlan

24 days ago

I was expecting tons of comments and personal comments about this, but here is only two thank you comments, and me thinking about the data you just shared. Thank you first. It is great to see even whales are first sendin extreme small fraction of amount to check the transaction security, and afterwards executes remaining amount (: I am just unsure about the amount of price movement 600k eth would bring as sell order. This is exactly the moment we would see the depth of the market in action. Unfortunately I don't have tools to check it out. But if you can, it would be important addition to the idea you presented.

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PAUL

24 days ago

DAA is a proxy tool for demand . If DAA increases you can assume that a decent buy pressure is in market to absorb the sell pressure ( For now its 600 k eth ) . Also , the whale need not sell eth all at once becoz whales generally sell into the rally @ high prices to claim more profits without affecting the price to tank .

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PAUL

24 days ago

DAA - depth of market in my opinion . It is my tool to analyze the depth of market .

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Santrends

Author
24 days ago

Appreciate, Baris Yeah, this amount in a single order could be a disaster

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Baris Parlan

24 days ago

Thanks for clarification. Since that dump didn't happened, is there any possibility of this wallet trying to scare public and media with this move? Because if whale does that, they should sell asap to maximize profit, isn't it? Waiting may mean just show-off or a move for news coverage - price manipulation?

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Santrends

Author
24 days ago

We don't know. Just our guesses. I'm thinking lately that it could be explained quite simple. No conspiracy theories. No fud. Just an official exchange contractor marketmaker moving his funds to do his job, absorb sell pressure or buy pressure accordingly, on a single exchange. How big are the usual volumes marketmakers are working with? I have no idea.

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Anson

Edited 24 days ago

Baris…after reading your post Aug 24 and also reading Dino’s comment re: your post..I made the decision on the 24th to hedge my position in ETH…selling of a % …been tracking throughout today 25th thru a rather ‘low key’ day for ‘obvious’ Metrics re: ETH…at least to my ‘newbie’ understanding of the the Metric/Indicators Boris, Congrats on the ‘exciting’ find I’m sure we will all ‘ultimately’ learn something thru this event Regards

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PAUL

24 days ago

The Network Activity is not enough for price to rally since DAA is glued to 400 - 500 k whilst DAA climbed from 500 - 800 k in the past rally , also , Circulation is hovering around 900 k whilst it was 1.2 mill on average in the past rally , also , Volume in decline . But the Social Sentiment is above normal . This can be said as more talk less action . These add to your wonderful findings and support the short term view of possible stop in price rally as ETH MAY MOVE SIDEWAYS OR EVEN LITTLE DOWNWARDS . Also MVRV 365 & Network Profit Loss present levels have coincided local tops of ETH . Looking forward to the weekly call and learn more from Brian & Deno . @Santrends Thank You for the Insight

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Santrends

Author
24 days ago

Appreciate 🙏🏻

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Anson

24 days ago

Paul Appreciate your insight. I’m going to have to read and re-read your input and then Ponder the ‘takeaways! As today is my first day as a Santiment subscriber! Regards

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Anson

Edited 24 days ago

Agreed, I too hope that Dino, Brian and Team…revisit this ‘event’ and delve into the ‘takeaways’ (lessons) … thru the various Metrics…along with the hindsight we will have on the outcome or lack of any significant outcome Dino also was ‘speculating’ that it could well be an Exchange..aka Binance… re- shuffling their coin supply for ??? :-)

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PAUL

24 days ago

thank you my friend

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Anson

23 days ago

:-)

Thank you immensely for your effort. As a user I really appreciate such nice reports that try to give a hint and prepare us mentally for what might come instead of freaking us out!