BTC Held On Exchanges Hits Lowest Point In 5 Five Years, Here’s What It Means For Bitcoin Price
18 October 2024 - 8:00AM
NEWSBTC
The Bitcoin price has already been up by 10% in the past seven
days, breaking above the $67,000 mark again in the last few hours.
The Coinmarketcap Fear And Greed Index has now switched to greed in
light of recent buying momentum and is showing no signs of slowing
down. The buying pressure on Bitcoin has been so great in the past
few days, leading to a huge decline in the number of BTC available
on crypto exchanges. According to on-chain data, this has caused
the Bitcoin exchange reserve to drop to its lowest point in five
years. BTC Exchange Reserve Drop to 5-Year Low Over the past few
days, the demand for Bitcoin has outweighed its supply, leading to
a sharp decline in the exchange reserves. According to CryptoQuant
data reposted on social media platform X by crypto analyst Ali
Martinez, the number of BTC held on exchanges is now at a five-year
low of 2.6 million BTC. Related Reading: Crypto Analyst
Identifies Bull Flag That Could Send Solana Price To $1,400
Martinez’s chart reveals an intriguing trend in Bitcoin’s exchange
reserves that has unfolded throughout the year. At the beginning of
2024, the reserves stood at approximately 3.05 million BTC.
However, this number has declined massively since that time. The
dwindling supply of Bitcoin on exchanges can be attributed to
several key factors. First, there’s the surging interest from
institutional players, especially following the approval and
growing momentum of Spot Bitcoin ETFs. These ETFs have triggered
significant buying activity, with US-based Spot Bitcoin ETFs
eventually becoming the second-largest holders of BTC behind
Satoshi Nakamoto. Many long-term holders also contributed to the
buying pressure, as many continued buying in droves. Even periods
of price corrections and selloffs from short-term holders were
highlighted by the movement of more BTC into stable long-term hands
who are less likely to sell. As a result, the total amount of
Bitcoin held on crypto exchanges has dropped by about 450,000 BTC
since January, bringing the current reserve to just 2.6 million
BTC. This is the lowest level seen since January 2019, and such a
sharp decline typically signals a bullish outlook for Bitcoin. “We
all know what this means,” Martinez said. What Does This Mean For
Bitcoin Price? The current state of Bitcoin’s exchange reserves
suggests that market participants are increasingly holding onto
their BTC in anticipation of future gains, as many people continue
to speculate about where the Bitcoin price could be heading in the
coming months. Related Reading: Dogecoin Holder Base Falls To
6-Month Low, But Analyst Believes DOGE Price Is Headed To $10 When
fewer coins are available on exchanges, it often indicates reduced
selling pressure, which drives the price higher as demand continues
to rise. Uptober is now fully in play, and Bitcoin is already
up by 6.3% in the month. At the time of writing, Bitcoin is trading
at $67,200. This notable price point puts Bitcoin on the path to
breaking above its all-time high of $73,737 before the end of
October. Featured image created with Dall.E, chart from
Tradingview.com
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