Antony Parsons
According to data from CryptoQuant, the amount of Bitcoin held on centralized exchanges has fallen to a multi-year low.
Over 51,000 BTC Withdrawn in Past Month
In the past month alone, over 51,000 BTC have been withdrawn from major exchanges, continuing a trend that suggests a reduction in the liquid supply of Bitcoin. This indicates that many market participants are opting for non-custodial storage, oriented towards long-term holding.
Exchange Reserves Down 800,000 BTC Since October 2021
Since October 2021, exchange reserves have decreased from 3.2 million BTC to approximately 2.6 million BTC, a drop of 800,000 BTC. This reduction is partly due to the distribution of Mt.Gox funds to creditors and a decrease in reserves on Coinbase, which has reduced potential selling pressure on Bitcoin.
Mt.Gox Distribution and Coinbase Reduction Contribute to Decline
The reduction in reserves is partly due to the distribution of Mt.Gox funds to creditors and a decrease in reserves on Coinbase, which has reduced potential selling pressure on Bitcoin. According to CryptoQuant’s research head, Julio Moreno, a significant portion of funds are being transferred from Coinbase to specific wallets for long-term storage.
“Whale” Investors Accumulate BTC
“Whale” investors, defined as non-miner, non-exchange wallets with over 1,000 BTC and a “coin age” of less than 155 days, are accumulating Bitcoin, driving up the price. New institutional investors now hold 1.97 million BTC, according to CryptoQuant.
Large Investors Accumulate, Small Players Reduce Holdings
Large investors are steadily accumulating Bitcoin, while smaller players are reducing their holdings, often leading to a situation where most exchange users exhaust their resources and then buy back Bitcoin at higher prices. “This development often leads to a situation where most users exhaust their resources and then have to buy back Bitcoin at significantly higher prices,” said CryptoQuant analysts.
Strong Buying Pressure on Coinbase and Bitfinex
According to CryptoQuant’s analysis, there is strong buyer pressure on Coinbase, while Binance and Bybit are seeing short positions. The firm’s analyst, J.A. Maartunn, notes that the accumulation of Bitcoin by new institutional investors is unprecedented, with a significant portion of funds being transferred to specific wallets for long-term storage.
Experts Weigh In
“We observe unprecedented buyer pressure thanks to a new wave of accumulation. New ‘whales’ are buying Bitcoin, pushing its price up,” said J.A. Maartunn, analyst at CryptoQuant. “This is not only the result of spot Bitcoin ETF activity, but also involves other large players.”
“On the other hand, institutional investors are strengthening their positions before market sentiment improves. This will force them to distribute their reserves during the next price surge,” added CryptoQuant’s research head, Axel Adler.
Conclusion
The reduction in exchange reserves and accumulation of Bitcoin by “whale” investors suggests a bullish outlook for the cryptocurrency. As institutional players continue to accumulate Bitcoin, it is likely that the price will continue to rise, forcing smaller players to buy back in at higher prices.
