Bitcoin on Exchanges Plummets to Five-Year Low, Signaling Bullish Market Ahead
The number of Bitcoin being held on cryptocurrency exchanges has recently dropped to a new five-year low after beginning a significant decline earlier this year, to the point that there are now around 2.6 million BTC on these platforms, down from around 3.3 million two years ago.
That’s according to data from cryptocurrency analytics firm CryptoQuant, which analyzes the amount of BTC being held on wallets associated with cryptocurrency exchanges on-chain. These exchange wallets pool the funds of the platform’s users, and reflect the amount of Bitcoin available for sale on the market.
#Bitcoin balance on exchanges just hit an all-time low in the last 5 years 👀 pic.twitter.com/KeVN24SD7J
— Vivek⚡️ (@Vivek4real_) September 27, 2024
A lower amount of Bitcoin on exchanges is considered as a bullish signal, as if demand for the cryptocurrency remains steady or rises it could lead to a price rise, given the lowering amount of available supply.
The drop comes at a time in which Bitcoin miners have significantly reduced their BTC reserves, to the point they’re now at their lowest level since January 2021, when the cryptocurrency’s price exploded from around $25,000 to over $69,000 before entering a downturn.
The total amount of Bitcoin held by miners has plummeted to a three-year low as a direct consequence of the recent halving upgrade in April, which halved the coinbase reward miners receive per new block found.
According to a report from Bloomberg citing Kaiko data, the amount of Bitcoin held by miners has dropped to around 1.5 million BTC, worth around $86 billion. Miners have notably seen selling tokens since the cryptocurrency market rallied in late 2023, with the proceeds from these sales often being used to fund their operations.
Despite the overall trend, publicly traded mining firms like CleanSpark and Riot Platforms have increased their Bitcoin holdings by 60% since the start of the year, according to SEC filings, while Marathon Digital Holdings recently invested $100 million in the cryptocurrency.
Featured image via Unsplash.
