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Crypto Markets Analysis: Bitcoin, Ether Exchange Balances Take Divergent Paths
Investors have begun sending bitcoin to exchanges while continuing to remove ether.
Updated Feb 22, 2023, 9:24 p.m. Published Feb 22, 2023, 9:24 p.m.
Bitcoin and ether have parted ways in the inflow to and outflow from exchanges.
Net position metrics show that Investors are sending bitcoin to exchanges and removing ether from them. The moves imply bearish sentiment for BTC and bullishness for ETH, a departure from their more typical correlated paths.
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Exchange balances tend to increase when investors are considering selling an asset, or at least placing themselves in positions to do so quickly. Investors removing assets from exchanges implies that investors are looking to hold the asset.
The current trends don't necessarily predict longer-term future investor action, but they are noteworthy. Bitcoin trending bearishly would run opposite its average performance following a "golden cross," such as the one that the asset reached Feb. 18. Bitcoin’s price rose an average 8% following the seven golden crosses since 2015 that preceded the latest one.
A golden cross occurs when the price of an asset’s 50-day moving average surpasses its 200-day moving average.
Motivations?
What’s behind the latest movements?
BTC prices remain up 42% year to date, and investors may be unable to ignore the temptation of realizing profits. A key point to watch will be whether BTC movement onto exchanges rises. The current increase has been mild, which may reflect more that investors are looking to manage risk as the market seems to be emerging from a period of contraction than negativity.
ETH activity has been more pronounced because its exchange net position change has been negative in each of the last 13 days. ETH was removed from exchanges even as prices declined 10% between Feb. 7 and Feb. 13.
Year to date, BTC has outperformed ETH by approximately 8%, despite ether’s supply declining by 33,000 ETH since September.
The difference between BTC and ETH in exchange net position has not extended to the derivatives space. Funding rates for both bitcoin and ether remain positive, indicating that long-position traders are willing to compensate short-position traders to maintain their bullish stance.
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Exchange Review - March 2025
CoinDesk Data's monthly Exchange Review captures the key developments within the cryptocurrency exchange market. The report includes analyses that relate to exchange volumes, crypto derivatives trading, market segmentation by fees, fiat trading, and more.
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Trading activity softened in March as market uncertainty grew amid escalating tariff tensions between the U.S. and global trading partners. Centralized exchanges recorded their lowest combined trading volume since October, declining 6.24% to $6.79tn. This marked the third consecutive monthly decline across both market segments, with spot trading volume falling 14.1% to $1.98tn and derivatives trading slipping 2.56% to $4.81tn.
- Trading Volumes Decline for Third Consecutive Month: Combined spot and derivatives trading volume on centralized exchanges fell by 6.24% to $6.79tn in March 2025, reaching the lowest level since October. Both spot and derivatives markets recorded their third consecutive monthly decline, falling 14.1% and 2.56% to $1.98tn and $4.81tn respectively.
- Institutional Crypto Trading Volume on CME Falls 23.5%: In March, total derivatives trading volume on the CME exchange fell by 23.5% to $175bn, the lowest monthly volume since October 2024. CME's market share among derivatives exchanges dropped from 4.63% to 3.64%, suggesting declining institutional interest amid current macroeconomic conditions.
- Bybit Spot Market Share Slides in March: Spot trading volume on Bybit fell by 52.1% to $81.1bn in March, coinciding with decreased trading activity following the hack of the exchange's cold wallets in February. Bybit's spot market share dropped from 7.35% to 4.10%, its lowest since July 2023.
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What to know:
- Ethena's USDe becomes fifth stablecoin to surpass $10 billion market cap in just 609 days, while Tether's dominance continues to slip.
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