Exchange netflow (exchange reserves)

On-chain analysts label the deposit and cold-storage addresses of major exchanges and add up how many coins arrive and leave each day. Inflows minus outflows give the netflow, and the running total gives exchange reserves, the estimated amount of a coin sitting on trading platforms.

The usual reading is simple: coins moving onto exchanges are more likely to be sold or used as margin, while withdrawals to self-custody suggest holders plan to keep them. Years of falling bitcoin exchange reserves fed the 'supply squeeze' thesis, and sudden large inflows from whales are often flagged as warning signs before volatile moves.

Address labelling is never complete, so figures differ between providers and can jump when a new exchange wallet is identified. Coins moving to ETF custodians, OTC desks or internal transfers between hot and cold wallets distort the picture. Stablecoin inflows are read the opposite way, as dry powder ready to buy.