Bitcoin (BTC) Has Been Flowing to Coinbase from Other Exchanges, Here's What This Has Historically Meant for the Asset

On-chain data shows Bitcoin has been moving to Coinbase from other exchanges. Here's what this has historically meant for the asset.

Fresh analysis of on-chain data shows Bitcoin has been moving to Coinbase from other exchanges. Here’s what this has historically meant for the asset.

Bitcoin Coinbase Flow Pulse Has Turned Back Green Recently

As noted by CryptoQuant author Axel Adler Jr in a recent post on X, Coinbase has resumed experiencing net inflows from other exchanges. An indicator of importance in this regard is the “Coinbase Flow Pulse,” which tracks the net amount of Bitcoin flowing between Coinbase and the other cryptocurrency exchanges.

The below chart shared by the analyst shows the trend in the 7-day moving average (MA) of this indicator over the last few years.

The Bitcoin Coinbase Flow Pulse has been positive since mid-2023, which means that Coinbase has been receiving net inflows from the other centralized exchanges.

However, the trend of the indicator around its 90-day MA is more significant, which is also shown in the same chart. The analyst has defined two zones for BTC based on where the 7-day MA is compared to this long-term MA.

When the 7-day MA drops below the 90-day MA, BTC will likely see bearish action, so these periods are classified as “Bear Market or Correction” (red). On the other hand, the metric above this line denotes “Bull Market” (green).

As evident in the graph, the 7-day MA of the Coinbase Flow Pulse had just fallen below the 90-day MA, but now, the two have crossed back, suggesting that demand for moving coins to Coinbase has picked up again.

The last time this pattern formed for the cryptocurrency was just before the rally towards the new all-time high (ATH). So, this signal might be also be bullish for the price this time.

As for why Coinbase may be important in this way for the asset, the answer could be because the platform is the known destination of American institutional entities. Hence, a flow of coins from other exchanges into Coinbase could be denoting demand from these US-based whales.

While the market outlook seems positive from the perspective of the Coinbase Flow Pulse, another indicator from on-chain analytics firm CryptoQuant might not be so bright.

As explained by CryptoQuant Head of Research Julio Moreno in a recent X post, Bitcoin demand is still muted when considering the “Apparent Demand” metric, which attempts to gauge the demand present in the entire market and not just a section of it like the Coinbase Flow Pulse.

Earlier in the year, demand for Bitcoin was at good levels, but it seems to have dropped off hard after the long consolidation stretch, as the Apparent Demand is currently at more or less neutral values.

BTC Price

At the time of writing, Bitcoin is trading at around $61,000, having risen over 5% in the past week.

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