- Bitcoin’s exchange supply hits a two-year low.
- Whales withdraw BTC from exchanges, signaling bullishness.
- Reduced BTC on exchanges could ease selling pressure.
Despite Bitcoin’s recent struggles amidst broader bearish market pressures, on-chain data suggests a potential shift in momentum, as the cryptocurrency’s supply on exchanges hits a two-year low.
After a previous dip, Bitcoin reached a high of $69,977 the previous day, only to decline to $67,028 early today, further impacting altcoins.
However, on-chain data suggests that the ongoing market sell-off might soon pause. In a post on X, market intelligence platform Santiment revealed that Bitcoin’s supply on exchanges has dropped to its lowest level since December 2021. Specifically, centralized trading platforms now hold a Bitcoin reserve of approximately 942,000 BTC tokens valued at over $63 billion.
Notably, a reduced supply of BTC on centralized exchanges is often considered a bullish signal, as it implies that prominent investors are moving their tokens to private storage. Fewer tokens on exchanges generally mean less selling pressure for the market.
Santiment’s chart illustrated that exchanges maintained heightened Bitcoin reserves since the third quarter of 2023. A declining trend emerged in Q1 2024, coinciding with the overall bullish state of the market, where Bitcoin hit a new all-time high of $73,650.
A recent update from on-chain analyst Ali Martinez further confirms the diminishing supply of Bitcoin on exchanges. Citing data from CryptoQuant, Martinez revealed that whales have moved 14,140 BTC worth over $950 million from exchanges in two days.
Meanwhile, Santiment noted that while Bitcoin’s supply on exchanges has decreased, Ethereum (ETH) and Tether USD (USDT) are flowing back into exchanges. However, the intelligence platform argued that historically, there is less drop-off risk for the entire crypto market when BTC’s available supply for sale is limited.
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