Posted by Xoken.org – Bitcoin reserves on crypto exchanges were reported by CryptoQuant to be at their lowest level since 2021. According to CryptoQuant’s Bitcoin Exchange Reserve dashboard, balances on the platform dwindled to just 1,945,051 BTC on April 2, 2024.
In comparison, Bitcoin exchange reserves of 2,087,030 BTC at the start of the year have been reduced by 90,700 BTC in the past month. As of July 2021, bitcoin exchange reserves hovered around the 2.8 million mark, indicating a decline of around 900,000 coins since CryptoQuant began tracking this metric.
However, Glassnode data shows that of the Bitcoin still traded on exchanges, there have been significant transfers from long-term holders to short-term holders.
“Following historically tight supply, the difference between the supply of long-term and short-term shareholders began to decrease, and as prices rose, and unrealized profits held by investors increased, this prompted long-term shareholders to divest their holdings,” explains Glassnode reports.
The report said short-term holder supply has increased by around 1.12 million Bitcoins. Meanwhile, according to data from Coinglass, Binance is the exchange with the largest number of Bitcoin holdings
538,750 BTC. Bitfinex, Coinbase, and Gemini are the next largest, controlling 372,000 BTC, 292,000 BTC, and 133,000 BTC respectively.
On-chain data also shows that the supply of Bitcoin on OTC desks has decreased in recent months. Since January 11, the main source of OTC demand for Bitcoin has been from the US Bitcoin spot ETF, which has absorbed US$12 billion in flows since its launch.
The ETF now holds more than 827,000 BTC, making it a major part of the global Bitcoin spot market. Some analysts claim that its launch could hurt business on crypto exchanges.
On the other hand reduced Bitcoin supply on these exchanges can also be interpreted as a bullish signal as fewer coins available for sale means a surge in demand could lead to higher price increases.
Meanwhile, currently the price of Bitcoin is trading at US$68,000, experiencing an increase of 3.10% in the last 24 hours, (5/4/24).