According to the data of the chain, informed by glass node, the amount of BTC on exchanges is at its lowest level in the last four years. In numbers, the amount is 2.4 million bitcoins, or about 12% of the total supply in circulation: 19,182,837 BTC, right now.
Apart from the cryptocurrency crash in the last year, other factors may also be contributing to this scenario. The first of these is the recent lack of bitcoin volatilityafter all, this is a “spice” sought after by many risk-loving traders.
However, the main point of this metric is linked to the intention to sell, mainly from long-term investors. After all, for security reasons, it’s best to keep your bitcoins in your own custody while you don’t have to use them.
Bitcoin on Exchanges Hits Lowest Level Since 2018
After passing the 3 million bitcoin mark in exchange wallets, this number has only been falling. It even rallied after the May 2021 high, but continued the same trend after BTC hit a record high in November last year.
The Bitcoin balance of cryptocurrency exchanges reaches the lowest level in the last 4 years. Source: Glassnode/CryptoSlate.
In the analysis, we can believe that investors are less likely to sell their coins, while Bitcoin is experiencing a major bear market. Furthermore, the recent lack of volatility may be scaring away even traders who were previously looking for big rewards associated with high risks.
Another point is the safety of funds. After all, it is safer to carry your cryptocurrencies with you, avoiding confiscations and hacks. As for attacks, fortunately these are less frequent on centralized exchanges, although they have increased in the cryptocurrency sector. decentralized finance (DeFi).
The market is still in “extreme fear”
Another metric points to Bitcoin investors still feeling “extreme fear.” That is, they fear that the BTC crash is not over yet, mainly because they believe that the Fed will keep raising the interest rate.
Bitcoin Greed and Fear Index, pointing to “extreme fear”. Source: alternative.me
While this sounds like a sign to stay away from Bitcoin investments, it could actually mean the opposite. After all, often the best time to buy is when others are panicking, that is, when the market is driven more by emotion than rationality. Later, these same investors must return, attracted by greed.
Another cryptocurrency that seems to be in the same pattern is ethereumforgotten after its biggest update in history last month, but which is also a great name in the long run, since it is controlling its inflation.
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