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Historical knowledge of an on-chain indicator might counsel Bitcoin might not be at risk of one other sharp crash proper now.

Bitcoin Spot Exchange Depositing Addresses Stay At Very Low Values

As identified by an analyst in a CryptoQuant post, indicators are that one other crash just like Q3 2018 isn’t more likely to occur presently.

The related indicator right here is the “spot exchange depositing addresses,” which is a measure of the full variety of Bitcoin pockets addresses which are making ship transactions to centralized spot exchanges proper now.

Generally, buyers deposit their cash on spot exchanges for promoting functions. Thus, a spike on this metric will be bearish for the worth of the crypto because it may very well be a touch at dumping habits from a lot of addresses.

On the opposite hand, low values indicate not many holders are including to the promoting strain out there in the meanwhile.

Now, here’s a chart that reveals the pattern within the Bitcoin spot change depositing addresses over the previous couple of years:

Looks like the worth of the metric has been taking place in current months | Source: CryptoQuant

As you possibly can see within the above graph, the quant has marked the related zones of pattern for the Bitcoin spot change depositing addresses.

It looks as if often round intervals the place this indicator has sharply risen as much as native tops, the worth of BTC has additionally noticed a high and subsequently declined.

Since the bull run high final 12 months, the spot change depositing addresses have been general winding down, seeing solely a few peaks within the interval.

Some buyers have not too long ago been questioning whether or not one other sharp drawdown is coming for Bitcoin within the close to future, similar to the one the 2018 bear market noticed after months of sideways motion just like now.

Looking on the chart for the pattern through the 2017/2018 cycle, it’s obvious that the metric declined following the bull run high after which plateaued at low ranges because the bear market went on.

However, in Q3 2018, the indicator instantly jumped up. A few months or so after this occurred, the worth noticed a crash.

As throughout current weeks there was no such sharp improve within the indicator, the analyst believes there isn’t any indication {that a} decline just like then would happen now.

BTC Price

At the time of writing, Bitcoin’s price floats round $18.8k, down 4% within the final week.

The worth of the crypto appears to have dipped under the $19k stage once more | Source: BTCUSD on TradingView

Featured picture from André François McKenzie on Unsplash.com, charts from TradingView.com, CryptoQuant.com