Trust & Intelligence · 60-second explainer

How We Detect Exchange vs Private Wallets

On-chain analysis · 60 seconds

Key takeaways

Exchange wallets have predictable deposit patterns and metadata
Private wallets show irregular activity and no exchange links
Cluster analysis groups connected addresses to identify owners
Transaction timing and size reveal wallet purpose and intent

Full explainer

Why do some Bitcoin wallets move millions while others sit dormant for years? The answer is in the patterns. Exchange wallets have telltale signatures—they cluster together, receive deposits from many sources, and move coins in predictable batches. Private wallets look totally different: irregular activity, no clear connections to known exchanges, and transactions that vary wildly in size and timing. Analysts use clustering techniques to link addresses and identify whether a wallet belongs to an exchange, a whale, or someone just holding Bitcoin. By studying deposit timing, withdrawal frequency, and transaction size, we can spot when whales are accumulating versus dumping. That's your edge.

Originally posted on YouTube: https://youtu.be/hkynzwJ0GSg

Glossary terms used in this explainer

@ 0:07

Whale Cluster

Multi-input common-input-ownership clustering: if 2 addresses sign the same TX as inputs, they're controlled by the same key. Builds whale-cluster maps (~7M clusters in our DB).

@ 0:28

Whale

Transactions of 500 BTC or larger but below the Mega Whale threshold (1,000 BTC). Common for large traders, OTC desks, exchange operations, and treasury management. Most actionable tier for daily flow analysis.

@ 0:36

Spot

The market for immediate delivery of an asset at the current price. Opposite of "futures" (where you trade a contract for future delivery) or "perpetuals" (perpetual-futures with funding rates). When we say "BTC price" without qualifier we mean spot.

@ 0:39

Alpha

Strategy returns minus benchmark returns (e.g. SPY for stocks, BTC HODL for crypto). Positive alpha = strategy beat the passive baseline. Negative = holding would have done better. Most active strategies show 0 or negative alpha after fees.