As a seasoned crypto investor with years of experience in this volatile market, I’ve learned to pay close attention to on-chain metrics like Bitcoin supply on centralized exchanges (CEX). The latest data from Glassnode suggesting that BTC supply has reached new lows is an encouraging sign for me. This mass migration of assets off exchanges indicates a bullish pressure and long-term holding, as opposed to flows into exchanges which are bearish since it’s easier to sell those assets there.
The amount of Bitcoin (BTC) held on centralized exchanges (CEX) has recently hit a fresh low, according to data from Glassnode, an on-chain analytics firm. With the market experiencing bullish momentum over the past two days, the Bitcoin supply on these exchanges now stands at approximately 1,728,782 coins – a figure not seen since earlier this year. This trend suggests that investors may be holding onto their Bitcoin for longer periods or transferring it to cold storage, away from the reach of exchanges.
In the past day, there was an exit of approximately 23,654 Bitcoins from the metric, with weekly outflows amounting to 19,859 Bitcoins. This decrease in Bitcoin circulation can be interpreted as a sign of heightened demand and bullish sentiment towards the asset. However, monthly flows were relatively low at around 9,509 Bitcoins.
Currently, Bitcoin is being traded for around $65,410 based on the latest news. This represents an increase from its price of roughly $60,000 just a week ago, following various attempts at recovery and fluctuations in the market.
Whales Move Assets Off Exchanges
In simpler terms, the large-scale shift of cryptocurrencies from exchanges to other storage solutions typically indicates a bullish market trend. This occurs when investors move their coins to long-term holding wallets rather than selling them on exchanges. Conversely, an influx of assets into exchanges is generally considered bearish as it suggests that people are selling their cryptocurrencies.
As an analyst, I’ve observed a trend in the crypto market that bears resemblance to miner behavior before Bitcoin halving events. Institutional investors are positioning themselves for the impending 50% reduction in mining rewards by increasing their holdings. In the past 24 hours, Binance recorded an outflow of 7,155 BTC, while Coinbase Pro experienced a significant influx of 16,075 BTC. These figures suggest institutional purchases are on the rise.
A Bybit report released last month indicated that all available Bitcoin on cryptocurrency exchanges could be depleted within the next nine months. Factors contributing to this prediction include the upcoming Bitcoin halving event and increased inflows into Bitcoin exchange-traded funds (ETFs) that are traded on the spot market.
Market Sentiment Sees Bitcoin Supply Plunge
Recent surge in crypto asset values has fueled optimistic outlooks among investors, causing them to purchase and hold onto these assets for extended periods. Consequently, there’s been a decrease in Bitcoin availability on exchanges over the past two days. The publication of favorable Consumer Price Index (CPI) data and institutional announcements concerning spot Exchange-Traded Fund (ETF) ownership have kept market conditions unchanged.
Several traditional finance companies disclosed their holdings in Bitcoin spot ETFs this week, leading to renewed price increases in the cryptocurrency market.
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2024-05-17 01:31