According to a recent report by Glassnode, a blockchain analytics firm, the supply of Bitcoin is becoming increasingly scarce as more holders are unwilling to sell their coins. The report shows that 90% of the Bitcoin supply has not moved in the last three months, indicating a strong conviction and confidence in the long-term value of the cryptocurrency.
The #Bitcoin Supply is historically tight, with an all-time-high in coins held by Long-Term investors, and impressive rates of accumulation taking place.
— glassnode (@glassnode) November 7, 2023
The report also reveals that the amount of Bitcoin held by entities with a balance of 1,000 BTC or more has reached a new all-time high of 7.9 million BTC, or 42% of the total supply. This suggests that large investors, such as institutions and whales, are accumulating Bitcoin and holding it for the long term.
Another indicator of Bitcoin’s tightening supply is the decreasing amount of coins on exchanges. Glassnode reports that the balance of Bitcoin on exchanges has dropped by 16% since March 2020, reaching the lowest level since November 2018. This implies that more users are withdrawing their coins from exchanges and storing them in cold wallets or other secure platforms.
Bitcoin Stands on an Interesting Situation
The shrinking supply of Bitcoin is a bullish sign of its price, as it creates a supply and demand imbalance that favors the buyers. As Glassnode tweeted, “The amount of Bitcoin needed to get us to $100k is less than 450k BTC. We have seen more than that exit exchanges in the last 10 months.”.
The actions of those who have held onto their Bitcoin for 2-3 years suggest that we might be in the early stages of a robust bull market. These observations carry substantial implications.
The cryptocurrency market is currently in a state of expectancy, influenced by potential events such as the approval of a Bitcoin ETF and the forthcoming halving. As these Bitcoin holders maintain control over their assets, it prompts speculation about when the next market surge will occur.
The question arises: are these Bitcoin holders privy to some information, or will they eventually succumb and sell their holdings? The future of the market is uncertain, and the decisions of these resolute investors could play a pivotal role in shaping what’s to come in the Bitcoin landscape.