BTC Wallet Inflows and Outflows Corresponding to Buy and Sell Relationships

┈┈➤ Classification of BTC Wallets

In fact, BTC wallets can be divided into two types or even three types.

╰┈✦ Classified by Management Entity

Classified by management entity, including exchange wallets, institutional custody wallets, and ordinary holding wallets.

The management entity of exchange wallets is, of course, the exchange itself.

The management entity of institutional custody wallets is the institution that provides custody services. The most prominent custody wallet in terms of scale and influence is Coinbase Prime.

The management entity of ordinary holding wallets is the holders themselves.

╰┈✦ Classified by Application Scenarios

Classified by application scenarios, including exchange hot and cold wallets, and holding wallets.

Exchange wallets are essentially the coins deposited by users into the exchange, and their application scenario is trading.

Holding wallets include custody wallets and ordinary holding wallets. Their main application scenario is storage.

┈┈➤ BTC Wallet Inflows and Outflows Corresponding to Buy and Sell Relationships

Firstly, all wallet inflows and outflows may just be wallet reorganization.

╰┈✦ BTC Inflows and Outflows of Exchange Wallets

The inflows and outflows of exchange wallets correspond to the inflows and outflows of BTC on the exchange.

Therefore, the motivation for BTC inflows into exchange wallets is mainly selling, while the motivation for outflows is mainly buying.

Of course, there are also motivations related to wealth management, margin for contracts, or simply depositing into the exchange, but we will focus on the main motivations.

╰┈✦ BTC Inflows and Outflows of Holding Wallets

The motivation for inflows into holding wallets is mainly storage, while the motivation for outflows is primarily selling.

Of course, inflows into ordinary holding wallets may also be motivated by over-the-counter sales, but over-the-counter transactions do not affect BTC market prices.

BTC inflows into custody wallets are for storage and not for sale; custody services are only responsible for safe keeping and do not provide trading services. BTC outflows from custody wallets are likely for selling.

┈┈➤ Which Wallets' BTC Flows Should Be Focused On?

Inflows and outflows are actually corresponding; inflows and outflows between holding wallets may be wallet reorganization, or could be over-the-counter transactions, etc., but this does not affect BTC market prices.

Inflows between holding wallets and exchange wallets have a greater impact on market prices. Therefore, we mainly focus on the BTC inflows and outflows of exchange wallets.