by Coinstrooper Crypto Articles
Quick Take
  • Ethereum inflows into exchanges mirror this trend, sitting at a two-month low with the 7-day average down to 783K ETH, from 1.8 million ETH on August 15.
  • Moreno also revealed that the Bitcoin Bull Score has shifted from “bearish” to “neutral” ahead of the Fed meeting.
  • The index has climbed from 20 to 50 over the past four days.
  • Two weeks ago, Bitcoin hit a low of around $108,000; since then, it has recovered to $115,000.

What Happened

Bitcoin and Ethereum exchange inflows have dropped to a 1-year low, indicating reduced selling pressure and investor reluctance to exit positions ahead of a potential U.S. Federal Reserve rate cut.

Meanwhile, stablecoin deposits, particularly USDT, have risen sharply, showing that investors are building dry powder for potential buying opportunities following the Fed’s announcement, according to the latest CryptoQuant Market insight.

He describes this rising inflow as growing “dry powder” that investors are accumulating to deploy into the crypto market, particularly Bitcoin, if the expected 25bps rate cut materializes today.

The consistent outflows from Binance also reflect investors’ early positioning ahead of this event, which is fueling the bull case for Bitcoin to finally break the $120k psychological resistance.

Market Context

Most analysts, including BitMEX Co-founder Arthur Hayes, expect the Fed to cut rates, with prediction markets like Polymarket showing a 91% probability of a rate cut.

Crypto analyst Rekt Capital shared that Bitcoin needs just one daily close and successful post-reclaim retest of ~$117,200 to confirm a return into the blue daily range at $120k and resume another leg of the bull run.

Why It Matters

As a basic principle, outflows signal buying pressure (coins leaving exchanges), while inflows indicate selling pressure (coins moving onto exchanges).

On the technical front, the Bitcoin daily chart shows several key patterns converging to suggest a bullish outlook.

Details

On-chain data reveals that exchange inflows have fallen to a 7-day moving average of 25K BTC, the lowest level in over a year, and down substantially from 51K BTC in July.

Bitcoin & Ethereum Inflows Crash 50% As Largest Holders Stop Selling

The average BTC deposit per transaction has also halved from 1.14 BTC in mid-July to 0.57 BTC in September, indicating reduced sell pressure from larger holders.

Ethereum inflows into exchanges mirror this trend, sitting at a two-month low with the 7-day average down to 783K ETH, from 1.8 million ETH on August 15.

The average ETH deposit size has similarly declined from 40–45 ETH per transaction at previous peaks to just 30 ETH today, reflecting the same low sell-side activity observed in BTC.

Julio Moreno, head of research at CryptoQuant, noted that stablecoin net deposits, particularly for USDT, have surged, reaching $379 million on August 31, the highest level year-to-date.

Moreno also revealed that the Bitcoin Bull Score has shifted from “bearish” to “neutral” ahead of the Fed meeting.

The index has climbed from 20 to 50 over the past four days.

Two weeks ago, Bitcoin hit a low of around $108,000; since then, it has recovered to $115,000.

One key factor in this recovery is the movement of coins to and from exchanges.

Over the past nine days, Binance has recorded only outflows.

This trend appears to be a major catalyst behind Bitcoin’s recent bounce from $108k to $116k.

The pattern is coming at a crucial time, given that the FOMC meeting occurs today.

BTC is now posting its best September performance in 13 years.

Historically, whenever Bitcoin has closed September in green, October and November have been extremely bullish, with an average combined gain of 35%.

Technical Analysis: Bitcoin Lower Channel Breakout Targets $128K-$132K