Bitcoin on Exchanges Reaches Lowest Level Since 2017 Amidst Price Surge: A Bullish Trend Emerges
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In a significant development, Bitcoin has experienced a surge in price above the $30,000 mark, which has led to an interesting trend in the cryptocurrency market. Over the past five years, there has been a continuous decline in the amount of Bitcoin held on centralized exchanges, reflecting a decrease in investor confidence in these platforms.
According to a recent analysis by Glassnode, the number of Bitcoins held on exchange addresses has decreased by 11.7%, reaching a low of 2.27 million BTC. This is the lowest level since December 21st, 2017. Such a trend is generally seen as bullish for the underlying asset.
Further confirming this trend is the declining "exchange whale ratio," an indicator that measures the ratio between the top ten Bitcoin transactions to exchanges and the total exchange inflow. CryptoQuant data suggests that the selling pressure in the market may be diminishing, as low values of the "exchange whale ratio" indicate that whales, or large investors, are accumulating Bitcoin instead of selling significantly more than the rest of the market. This current market condition is reminiscent of the upward cycle observed in 2019.
The recent surge in Bitcoin's price was triggered by the filing of an application for a spot Bitcoin exchange-traded fund (ETF) by BlackRock, the world's largest asset manager. This move prompted two more US asset managers, WisdomTree and Invesco, to file fresh ETF applications, with Valkyrie following suit shortly after.
The decreasing amount of Bitcoin held on exchanges and the growing interest from institutional investors in ETFs indicate a positive sentiment towards Bitcoin and the cryptocurrency market as a whole. As more investors seek to hold Bitcoin in their personal wallets rather than on exchanges, it underscores a shift towards self-custody and a long-term investment outlook.
It will be interesting to observe how these trends evolve in the coming months and how they will impact the overall cryptocurrency market and the price of Bitcoin.
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