The percentage of Bitcoin (BTC) held on centralized exchange addresses has reached its lowest point since December 2017, according to data from Glassnode. The decline in BTC on exchanges has been a persistent trend since the aftermath of the COVID-19 crisis, signaling a shift in investor behavior and sentiment.
Following the COVID-19 Crisis, the percentage of #Bitcoin held across Exchange addresses has been in perpetual decline, dwindling to a current value of 11.7% (2.27M BTC), the lowest recording since Dec-21-2017. pic.twitter.com/HlLwzYwcuJ
— glassnode (@glassnode) June 26, 2023
This recent analysis reveals a continuous decline in the amount of Bitcoin held on custodial crypto wallets. The figures have now dwindled to 11.7% or 2.27 million BTC, reaching the lowest level recorded since December 2017. However, this is generally interpreted as a bullish sign for the asset.
Bitcoin (BTC) started the week on a solid note, settling above the $30,000 mark after experiencing rapid gains since last week. The recent surge in Bitcoin and other cryptocurrencies prices was instigated by BlackRock, the world’s largest asset manager, filing an application with the American Securities and Exchange Commission (SEC) for a spot Bitcoin exchange-traded fund (ETF).
This development prompted other additional US asset managers, including WisdomTree and Invesco, to file their own ETF applications last week, with Valkyrie following suit shortly after.
Moreover, Bitcoin’s performance over the past week has been impressive, experiencing a notable increase of 13.41% according to Coinmarketcap. As the largest cryptocurrency with a market capitalization of $589.3 billion, Bitcoin’s current price sits at USD 30,709, with a 24-hour trading volume of $14.6 billion USD. It has surged by just 1.19% in the past day.
Probable Causes for the Drop in Bitcoin (BTC) on Exchanges
There are several potential reasons behind the recent decline in Bitcoin on exchanges. One possible explanation is the growing belief in the long-term value of Bitcoin. Some investors may be withdrawing their Bitcoin from exchanges in anticipation of future price appreciation, viewing Bitcoin as a store of value with the expectation of continued price growth over time.
Additionally, the recent regulatory crackdown on cryptocurrency exchanges may have contributed to the decline in Bitcoin on exchanges. Concerns about the uncertain regulatory landscape could lead investors to store their Bitcoin (BTC) in cold storage until there is more clarity.
