The volume of Bitcoin and altcoin deposits on exchanges has surged, historically indicating periods of heightened volatility in the crypto market. This observation comes from CryptoQuant.
https://twitter.com/cryptoquant_com/status/2072764035850752158
On June 30, Bitcoin deposits on exchanges jumped to nearly 49,000 BTC. Julio Moreno, head of research at the company, described this as a rare extreme. He noted that this year, daily inflows have approached the 50,000 BTC mark only four times.
“At these inflow levels, the market absorbs a large volume of Bitcoins being transferred to exchanges—a model that has historically preceded significant directional movements,” emphasized Moreno.
According to him, the current increase in deposits is primarily driven by large holders rather than retail investors. The average transaction size has risen from about 1 BTC to 2 BTC, which CryptoQuant estimates indicates the transfer of larger amounts of assets to exchanges.
Moreno added that spikes in average deposit size have historically been a more bearish signal than just high inflow volumes: they reflect position redistribution among large participants and have often served as a leading indicator of downward pressure on prices.
The analyst linked the rise in deposits to Bitcoin testing the $60,000 support level. If this level is breached, the price could approach the realized price of around $53,000. At the time of publication, Bitcoin was trading around $62,420.
Ethereum and Altcoins Show Similar Signals
The trend has also affected Ethereum: deposits on exchanges exceeded 1.25 million ETH at the end of June. Moreno attributed this to increased selling pressure.
He noted that simultaneous spikes in inflows for both Bitcoin and Ethereum have historically indicated a broader market shift towards risk aversion.
Source: CryptoQuant.Activity in altcoins has also increased. Earlier this week, the number of deposit transactions approached 45,000—a peak not seen in nearly two months.
Moreno called this a historic signal of a turning point for prices and reminded that a similar spike was observed before Bitcoin's drop from about $82,000 in early May to below $58,000 by the end of June. He assessed that a repeat of this threshold during the test of the $60,000 support requires heightened caution from market participants.
It’s worth noting that at the end of June, an analyst using the pseudonym Darkfost announced the beginning of a capitulation phase for Bitcoin miners, which historically signals a market bottom.