H-020: BTC out of the market when 7-day net deposits to exchanges are in their top 20%
Pass Family: flows · Status: passed
This hypothesis passed its pre-registered test. That is a reason for independent confirmation and paper trading, not for trading real money.
Do Bitcoin exchange inflows predict price drops? This idea met the bar that was set before testing. It deserves a closer, independent look. It is not a promise of profit.
Result
oos: wins 1/1 (need 1), beats buy-and-hold 1/1
| Asset | Period | Sharpe | Hold Sharpe | CAGR | Hold CAGR | Max drawdown | Hold drawdown | In market | p-value | Beats hold | Counts as win |
|---|---|---|---|---|---|---|---|---|---|---|---|
| BTCUSDT | oos (2022-01-01 → 2026-10-13) | 0.83 | 0.50 | +30.6% | +13.1% | -44.2% | -66.9% | 83% | 0.010 | yes | yes |
Equity curves
Growth of 1 unit, log scale, fees included. Only days on which the rule is fully defined are counted.
The same rule on every coin
Exploratory check of this rule on all coins since 2022-01-01. It is not part of the verdict above.
- ✓works (passed the chance check)
- ↑better than holding, could be luck
- ✗worse than holding
- ·not enough data
- original coin of the hypothesis
| Coin | ✓ | Result | Sharpe: rule / holding | CAGR | From |
|---|---|---|---|---|---|
| BTC | ↑ | better than holding, could be luck | 0.80 / 0.48 | +29% / +12% | 2022-01-01 |
| ETH | ↑ | better than holding, could be luck | 0.55 / 0.20 | +17% / -9% | 2022-01-01 |
| SOL | ↑ | better than holding, could be luck | 0.55 / 0.35 | +14% / -10% | 2022-01-01 |
| BNB | ↑ | better than holding, could be luck | 0.44 / 0.42 | +10% / +8% | 2022-01-01 |
| XRP | ↑ | better than holding, could be luck | 0.62 / 0.51 | +23% / +10% | 2022-01-01 |
| ADA | ↑ | better than holding, could be luck | 0.08 / -0.01 | -18% / -32% | 2022-01-01 |
| LTC | ↑ | better than holding, could be luck | 0.34 / 0.11 | +1% / -18% | 2022-01-01 |
| LINK | ↑ | better than holding, could be luck | 0.31 / 0.30 | -5% / -10% | 2022-01-01 |
| DOGE | ↑ | better than holding, could be luck | 0.52 / 0.26 | +11% / -15% | 2022-01-01 |
| XLM | ↑ | better than holding, could be luck | 0.47 / 0.30 | +9% / -9% | 2022-01-01 |
| TRX | ↑ | better than holding, could be luck | 0.80 / 0.74 | +40% / +36% | 2022-01-01 |
| EVER | ✗ | worse than holding | -0.21 / -0.15 | -65% / -68% | 2022-03-19 |
| GRAM | ✗ | worse than holding | -0.26 / 0.13 | -32% / -17% | 2023-03-14 |
Why it might work
Idea by F1DevBin: coins moved to exchanges before price moves carry information. Deposits usually precede selling, so heavy net inflow should precede weaker returns (CryptoQuant and others read large inflows as bearish). Data: Coin Metrics community exchange flows (free, full history since 2011 for BTC, 2015 for ETH); collected daily into datasets/exchange_flows.csv. Spec revised on 2026-10-14 before any test was run: the first version waited a year for data, until it turned out the full history is available.
Verdict history
- 2026-10-14: Pass (this engine, data to 2026-10-13)
Pre-registered specification
kind: timing_rule
rule:
type: feature_vs_rolling_quantile
feature: exnetflow_btc_7d
q: 0.8
long_when: not_above
lookback: 365
min_periods: 180
lag: 1
mode: long_flat
fee: 0.001
universe:
- BTCUSDT
periods:
- name: oos
start: '2022-01-01'
significance:
method: circular_shift
n: 2000
alpha: 0.025
criterion:
min_wins:
oos: 1
require_significance: true