The CEO of CryptoQuant, a blockchain analytics firm, has revealed that the largest Bitcoin (BTC) traders are exhibiting a more cautious approach to risk. Ki Young Ju, with a substantial following of 349,000 on social media platform X, explains that the interexchange-flow-pulse (IFP) indicator, which tracks BTC movement between spot and derivatives exchanges, is indicating that whales are currently in “risk-off mode.” These traders deposit assets into derivatives exchanges and use them as collateral to engage in more risky leveraged positions. Ju highlights that the IFP is currently below its 90-day moving average, signifying the shift in sentiment.

Ju emphasizes that the IFP is an important indicator of Bitcoin movements between spot and derivative exchanges and reflects market sentiment. Increased flows from spot to derivative exchanges may indicate the use of BTC as collateral for new or existing positions. The movement of BTC to derivatives by whales often signals long positions, especially during cyclical market bottoms. Ju suggests that investors should target Bitcoin exposure during IFP uptrends, with the 90-day moving average crossovers serving as indicators of market shifts.

At the time of writing, Bitcoin is trading at $62,290, experiencing a decline of over 3% in the past day. CryptoQuant recently reported that Ethereum’s Market Value to Realized Value (MVRV) indicator is rising at a faster rate than Bitcoin’s MVRV. MVRV assesses whether a digital asset is undervalued or overvalued by comparing its market capitalization to its realized capitalization (the value of all assets at the price they were purchased). The firm suggests that this indicates a heating up of the Ethereum market, historically leading to other altcoins following suit.

At present, Ethereum is valued at $3,366, witnessing a decrease of over 4% within the day.

Disclaimer: The opinions expressed in this article are not to be considered as investment advice. Investors should conduct their own research before engaging in high-risk investments involving Bitcoin, cryptocurrency, or digital assets. Transfers and trades are conducted at the individual’s own risk, and any resulting losses are the individual’s responsibility. The Daily Hodl does not endorse the buying or selling of any cryptocurrencies or digital assets, nor does it provide investment advice. Please note that The Daily Hodl engages in affiliate marketing.

Generated Image: Midjourney