Decentral Block Post

Bitcoin (BTC) could be on the verge of a retail major sell-off as exchange inflows spike to almost three-and-a-half-year highs.

Data from on-chain analytics platform CryptoQuant shows users of 21 major exchanges sending coins to their wallets en masse on June 14.

Major exchanges finish up 83,000 BTC in a single day

As BTC/USD fell to lows of $20,800, panic appeared to set in among traders, and despite a reversal that at one point topped $23,000, few seemed willing to trust that the worst was over.

Since then, spot price action has returned to near $21,000, while 24-hour exchange inflows reached 59,376 BTC.

According to CryptoQuant data, this is the largest daily inflow since November 30, 2018. On that day, exchanges recorded 83,481 BTC of net inflows.

Ether (ETH) price nosedived below $1,100 in the early hours of June 14 to prices not seen since January 2021. The downside move marks a 78% correction since the $4,870 all-time high on Nov. 10, 2021.

More importantly, Ether has underperformed Bitcoin (BTC) by 33% between May 10 and June 14, 2022, and the last time a similar event happened was mid-2021.

Even though Bitcoin oscillated in a narrow range two weeks before the 0.082 ETH/BTC peak, this period marked the “DeFi Summer” peak when the Ethereum network’s total value locked (TVL) catapulted to $93 billion from $42 billion two months earlier.

What’s behind Ether’s 2021 underperformance?

Before jumping to conclusions, a broader set of data is needed to understand what led to the 31% correction in the ETH/BTC price in 2021. Looking at the number of active addresses is a good place to start.

Data shows steady growth in active addresses, which increased from 595,620 in mid-March to 857,520 in mid-May. So, not only did the TVL growth take investors by surprise, but so did the number of users.

Ether (ETH) price nosedived below $1,100 in the early hours of June 14 to prices not seen since January 2021. The downside move marks a 78% correction since the $4,870 all-time high on Nov. 10, 2021.

More importantly, Ether has underperformed Bitcoin (BTC) by 33% between May 10 and June 14, 2022, and the last time a similar event happened was mid-2021.

Even though Bitcoin oscillated in a narrow range two weeks before the 0.082 ETH/BTC peak, this period marked the “DeFi Summer” peak when the Ethereum network’s total value locked (TVL) catapulted to $93 billion from $42 billion two months earlier.

What’s behind Ether’s 2021 underperformance?

Before jumping to conclusions, a broader set of data is needed to understand what led to the 31% correction in the ETH/BTC price in 2021. Looking at the number of active addresses is a good place to start.

Data shows steady growth in active addresses, which increased from 595,620 in mid-March to 857,520 in mid-May. So, not only did the TVL growth take investors by surprise, but so did the number of users.

On June 14, discussions of Celsius continued to populate media headlines and June 14's news involved the platform's CEL token accruing massive gains after what appears to have been either an exchange glitch or a short-squeeze. CEL price spiked from $0.18  to $1.55 in one abrupt candle before sinking back to $0.60 within the same one-hour candle.

Currently, analysts are on the fence about the reason for the explosive price breakout. Some cite Celsius repaying a portion of its debts as a reason, while others pinpoint a possible error on the FTX exchange as the reason for what appears to be a short squeeze.

Are debt repayments boosting investor confidence?

Celsius has been scrambling to cover a number of its debts and it is possible that some investors view this as a sign that the platform will be able to survive the current mayhem. 

Twitter analyst Hsaka said that on-chain data shows that the $28 million in Dai (DAI) that was recently deposited into a wallet controlled by Celsius and has since been sent to a separate address, which he identified as a debt repayment address.

Analysts believe that the Celsius's strategy is to lower its liquidation price in the MakerDAO vaults  where it holds funds and ultimately avoid insolvency.

On June 14, discussions of Celsius continued to populate media headlines and June 14's news involved the platform's CEL token accruing massive gains after what appears to have been either an exchange glitch or a short-squeeze. CEL price spiked from $0.18  to $1.55 in one abrupt candle before sinking back to $0.60 within the same one-hour candle.

Currently, analysts are on the fence about the reason for the explosive price breakout. Some cite Celsius repaying a portion of its debts as a reason, while others pinpoint a possible error on the FTX exchange as the reason for what appears to be a short squeeze.

Are debt repayments boosting investor confidence?

Celsius has been scrambling to cover a number of its debts and it is possible that some investors view this as a sign that the platform will be able to survive the current mayhem. 

Twitter analyst Hsaka said that on-chain data shows that the $28 million in Dai (DAI) that was recently deposited into a wallet controlled by Celsius and has since been sent to a separate address, which he identified as a debt repayment address.

Analysts believe that the Celsius's strategy is to lower its liquidation price in the MakerDAO vaults  where it holds funds and ultimately avoid insolvency.