Record low of Bitcoin exchange reserves reached, according to CryptoQuant
Bitcoin exchange reserves have reached their lowest levels since early 2021, indicating a potential shift in how holders are storing their BTC. Over the past month, more than 90,700 bitcoins have been withdrawn from major cryptocurrency exchanges, according to data from CryptoQuant. This significant outflow suggests a decrease in Bitcoin’s liquid supply and suggests that investors are adopting a long-term holding strategy.
The movement of bitcoins from exchanges to cold storage aligns with a long-term trend that has been observed for several years. Factors such as the rising price of Bitcoin, the approval of spot Bitcoin ETFs, and anticipation of the halving event have contributed to this trend.
CryptoQuant’s data shows that in July 2021, Bitcoin exchange reserves were around 2.8 million, indicating a decline of approximately 900,000 coins since the firm started tracking this metric.
Despite the decrease in supply, Glassnode’s recent report highlights a shift from long-term to short-term holders. The report suggests that after a period of tight supply, the gap between long and short-term holder supply is starting to close. Rising prices and increasing unrealized profits are prompting long-term holders to sell their assets. On the other hand, short-term holders have seen a surge in supply, absorbing the distribution pressure from long-term holders.
In terms of price, Bitcoin has experienced a modest increase of about 3.2% in the past 24 hours, trading at $68,265 as of 1:46 p.m. ET. However, it still lags about 10% behind its all-time high of $73,000 reached in mid-March.
Industry experts remain optimistic about Bitcoin’s future. Kurt Wuckert Jr., the Chief Bitcoin Historian at CoinGeek, compares Bitcoin to gold and cash, highlighting its resistance to regulatory suppression. Joshua Petty, CEO of Ordinals Wallet, also believes in Bitcoin’s potential, suggesting that it could evolve or serve as a base for digital cash despite regulatory challenges.
The article concludes by noting that Bitcoin’s bull run has had a positive impact on the cryptocurrency jobs market, reaching a 12-month record.
