Definition ∞ Asset Netflow quantifies the movement of a specific digital asset into or out of a particular entity, such as an exchange or a smart contract. This metric indicates whether an asset is being deposited or withdrawn from these platforms over a given period. A positive netflow suggests an increase in holdings on the platform, while a negative netflow indicates a decrease. It provides a macroscopic view of investor sentiment and market activity for that asset.
Context ∞ Observing Asset Netflow is crucial for assessing market sentiment and potential price movements in cryptocurrency news. Significant positive netflows to exchanges often signal an intent to sell, potentially preceding price depreciation. Conversely, consistent negative netflows suggest accumulation or movement to cold storage, which can indicate bullish sentiment or reduced selling pressure.
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