Gemini Trust Company is a cryptocurrency company that is based in New York. The company is regulated and acts as a custodian and wallet that simplifies the process of purchasing Bitcoin. It offers a secure way to sell, buy and store digital assets. When the on-chain was analyzed, it was realized that there were huge inflows. The analysis revealed that the Gemini had incredibly large Bitcoin inflows that added up to USD 38,000. This happened right before the plunge.

Huge Bitcoin Inflows to Gemini

A CryptoQuant post mentioned that the Gemini crypto exchange company had large inflows early on July 31, 2021. This led to net flows realizing a positive increase.

Before getting into the data, some of the things you need to know include;

• Exchange inflow; this is how much bitcoin currency is sent to the exchange platform. It comes from personal wallets.
• Outflow; this is the cryptocurrency that is transferred into personal wallets. It comes from the exchanges.
• Net inflow; this is the difference in value between the outflow

Net Current

When you have a positive value of the current net, then you have more cryptocurrency. It means that more Bitcoin currency is going into the exchange than what is existing. An increase like this would mean that investors are able to sell. When investors want to sell their bitcoins, it puts more pressure on the market towards selling.

The other side is that, when the current net indicator reads as negative, investors will want to buy. It means that the buying pressure increases in the market. This is because more cryptocurrency will leave the exchanges, and investors will want to hold on to as much as possible. 

On July 31st, CryptoQuant released information concerning Gemini. The source showed that the Gemini BTC Netflow had a largely positive increase.

Initially, Gemini had just experienced a rise in Bitcoin Netflow. Additionally, right after these inflows occurred, the price of bitcoin fell to $ 38,000.

CryptoQuant also revealed that the other large positive net flows seem to have happened right before the decline in crypto prices. This suggests the net flows of Gemini and the price of the bitcoin currency are correlated.

Bitcoin Price at the Time

In the days leading to this event, the price of Bitcoin was about $ 40,000. There were minimal gains in cryptocurrency for the month. The cryptocurrency experienced a sharp drop to $ 38,000 from around $ 40,000.

The price remained in the range for quite a while. Bitcoin then faced a significant price shift. This happened when its price reached $ 40,000. The cryptocurrency maintained this for about 9 days. This price maintenance was something the coin has not witnessed in 6 years.

The slump was likely caused by Gemini’s inflows.

In the past, Gemini inflows have had similar occurrences. They result in sharp downtrends that affect the currency. These, however, do not mean that there is a drop in the currency. The net flow needs to be looked at regularly to monitor any changes. It provides investors with clues about the crypto exchange.

What Actually Happened?

For several days, everything was normal in the cryptocurrency world. The cryptocurrency has seen a recent drop and recovered from it. There was an addition of $19,000 in a span of two weeks. This allowed it to break over $60,000. It went as high as $61, 800 by the weekend.

The next few hours were chaotic. The situation was quickly reversed and a lot of pressure was placed on the primary cryptocurrency. It led to a significant drop of $ 7,000. This allowed the currency to lower to $55,000.

The cryptocurrency community could only speculate on why this happened. There were various reasons given and discussed on the news. One speculation was that it was caused by a ban on cryptocurrency in India. This was quickly dismissed since the idea had been around for a few months.

Ki-Young Ju is the CEO of CryptoQuant, a cryptocurrency analytics company. Ju suggested it was due to a huge deposit that occurred at Gemini Trust Company. On that day, a total of 18,000 bitcoins were deposited at Gemini. This amount is worth over $1 billion.

It can be believed that the huge inflow to Gemini Trust Company is what caused the drop in Bitcoin. This is the only explanation that is viable and makes sense. The timeline of the deposit to Gemini and when the currency dropped is too close to disregard. Any other attempts to explain the BTC drop reveal doubt, except for Ki-Young's suggestion. The deposit was made, then a drop happened. The large inflows into Gemini caused the $38,000 drop which led to inflows noting a positive increase. The deposit into Gemini affected the cryptocurrency in a significant way.

Pillar Article Entry (if needed):

For several days, everything was normal in the cryptocurrency world. The cryptocurrency has seen a recent drop and recovered from it. There was an addition of $19,000 in a span of two weeks. This allowed it to break over $60,000. It went as high as $61, 800 by the weekend.

The next few hours were chaotic. The situation was quickly reversed and a lot of pressure was placed on the primary cryptocurrency. It led to a significant drop of $ 7,000. This allowed the currency to lower to $55,000.

The cryptocurrency community could only speculate on why this happened. There were various reasons given and discussed on the news. One speculation was that it was caused by a ban on cryptocurrency in India. This was quickly dismissed since the idea had been around for a few months.

Ki-Young Ju is the CEO of CryptoQuant, a cryptocurrency analytics company. Ju suggested it was due to a huge deposit that occurred at Gemini Trust Company. On that day, a total of 18,000 bitcoins were deposited at Gemini. This amount is worth over $1 billion.