According to data from Glassnode, the amount of Bitcoin that is deposited in the main crypto exchanges has reached a minimum that we have not seen since May 2019. What does it mean?
Bullish Bitcoin?
This metric has been used multiple times by experts to assess where Bitcoin could go. Typically, the crypto market perceives the lower balance of Bitcoin deposited on crypto exchanges as a sign of new investors going long-term.
The reason is that a lower Bitcoin balance on crypto exchanges can be explained by the existence of a long-term holding strategy; in which investors carry their holdings to cold wallets.
Furthermore, it also means that there is a smaller portion of Bitcoin holders who could quickly sell their Bitcoins on crypto exchanges.
A fall since march
According to data recorded by Glassnode, the balance of Bitcoin in crypto exchanges has been falling since March 18, a moment that coincides with the abrupt drop in prices in the crypto market.
And interestingly, Arcane Research’s weekly report found that the decline in Bitcoin balances on crypto exchanges can be explained by the rise of DeFi.
The report explains that, as we have reported in CryptoTrend, a significant amount of Bitcoin has been tokenized in Ethereum. In fact, according to Dune Analytics, there are over 120,000 BTC worth around $ 1.1 billion in DeFi.
However, there may also be other explanations such as that, since March, the crypto market has seen a significant influx of institutional investors who prefer to keep their crypto away from crypto exchanges.
Meanwhile … only 2.5 million Bitcoin left to mine
Ok, so we have a decrease in available Bitcoin balances on crypto exchanges while only 2.5 million BTC remains to be mined. Do you know what will happen if demand increases on crypto exchanges?
Just this Saturday a Tweet from ChartsBTC made the crypto community realize that the amount of Bitcoin in circulation passed 18.5 million; with less than 2.5 million to be mined in the next 4 years.
Therefore, we are at a point where we reach a minimum of the available Bitcoin balances at the same time that the institutional demand has increased and the supply decreases with the passing of the days.
Is Bitcoin expecting a bullish wave soon? We want to know your opinion!
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