Key Points
- Bitcoin sees greater exchange outflows than inflows, indicating a recovery in demand.
- MicroStrategy continues to lead the charge in the spot market, despite weak derivatives.
Bitcoin Demand Recovers
Bitcoin has seen a higher rate of outflows from exchanges compared to inflows, indicating a recovery in demand. This comes after a period of sell pressure on the cryptocurrency. New data suggests that the pace at which Bitcoin is leaving exchanges is accelerating.
Previously, it was suggested that Bitcoin would likely experience a resurgence in buying pressure between the $59,896 and $61,801 price points. However, a pullback on August 1st suggested a growing buying pressure. On-chain data confirmed that demand for Bitcoin was rising once again.
Exchange Outflows and Inflows
Bitcoin’s aggregated exchange outflow volume peaked at 24,370 BTC in the last 24 hours. This suggests that BTC exchange outflows are nearing their highest levels for the week, which were observed on July 29th at 26,530 BTC.
In contrast, Bitcoin’s aggregated exchange inflow volumes showed a monthly peak of 59,460 BTC on July 24th. The latest data shows 15,950 BTC flowing into exchanges, confirming that outflows are higher than inflows, indicating a net positive on asset demand.
Despite declining exchange reserves, the derivatives segment signalled weak demand. Open Interest was on a downward trajectory, and Funding Rates had slowed, indicating uncertainty at the current price point.
MicroStrategy’s Bitcoin Purchases
Most of the prevailing demand appears to be coming from the spot market. MicroStrategy, in particular, has been taking advantage of the dips. The company’s chairman, Michael J. Saylor, recently revealed that the company added 169 BTC to its coffers, meaning the company now holds approximately 1.14% of Bitcoin’s current circulating supply.
MicroStrategy also announced plans to continue purchasing Bitcoin, with plans to issue more shares worth around $2 billion for further Bitcoin purchases.
Despite the current demand outshining sell pressure, there is still a significant amount of selling. July confirmed that there are still bearish factors in the market capable of triggering selloffs, such as governments selling their BTC holdings and economic data.
