- Bitcoin reserve in crypto exchanges has reached 6 months low as traders keep withdrawing around 2,000 Bitcoin per day.
- Over the last three weeks, the cumulative balance of exchanges has dropped by around 40,000 Bitcoin.
- The depletion of Bitcoin supply on exchanges is a bullish sign.
Over the last couple of weeks, the price of Bitcoin has been consolidating between a narrow range. During this period, the leading cryptocurrency has not traversed any of the key levels: $30,000 and $40,000. This can be an indication that the volatility has cooled off, at least for the moment.
A recent report by the leading blockchain analyzer Glassnode also mentions this lack of momentum, calling the past week “impressively quiet.” Meanwhile, the amount of Bitcoin on centralized crypto exchanges continues to diminish, reaching levels not seen since April.
Considering the general code that Bitcoin deficiency on crypto exchanges is a sign of an upcoming bull run, we can expect Bitcoin to explode in the close-by future. Glassnode puts it this way:
It is starting to feel like the calm before the storm as muted and quiet activity appears across both spot, derivative, and on-chain metrics.
Exchange BTC Levels Drop 2,000 Per Day
The report also noted that traders are withdrawing approximately 2,000 Bitcoin per day. Currently, there is merely more than 2.5 million Bitcoin available on crypto exchanges. On the other hand, more than 10 million BTC hasn’t moved in the last 12 months, meaning they are safeguarded by diamond hands.
A key price driver throughout the last bull run was the ruthless reduction of crypto exchange coins. However, during the May sell-off, this trend inversed as a wave of Bitcoin was deposited into exchanges. According to the report, the return to exchange outflows has been more positive in the last two weeks, accounting for around 2,000 Bitcoin per day.
As of now, the cumulative balance of exchanges has dropped by around 40,000 Bitcoin in the last three weeks alone. In comparison, a total of 140,000 Bitcoin has been deposited to exchanges since April, when Bitcoin managed to record a new ATH of around $55,000.
Earlier, on July 5, crypto analytics firm Santiment declared that Bitcoin is in accumulation as the reserve in crypto exchanges reached a six-month low.
The ratio of #Bitcoin's supply on exchanges has
encouragingly slid down to its lowest since early January. The 6-month low is a promising sign, as it generally will indicate that there is a decreased risk of more major $BTC selloffs. https://t.co/vFh7pcjUmX pic.twitter.com/t3duiStvg6
— Santiment (@santimentfeed) July 5, 2021
The depletion of Bitcoin supply on exchanges is surely a bullish sign, yet some traders continue to warn about the possibility of extended losses. Just recently, Scott Minerd, investments chairman at Guggenheim, stated that Bitcoin might plunge to $10,000 levels.
Minerd said that he believes a crash would mean 70% to 80% down.
“When we look at the history of crypto and we look at where we are, I mean, I really do believe this is probably a crash, and you know a crash would mean we’d be down 70-80% which, let’s just say that’s between 10 and 15 thousand,” he said.