BTC Balance On Exchanges Drops To Lows Seen In 2018

BTC Balance on exchanges dropped to new lows that were actually seen back in 2018 while some analysts say this trend is a huge sign that the investors are holding BTC for the long-term but let’s take a closer look in today’s Bitcoin news.

The BTC balance on exchanges fell to 2.3 million BTC which is the lowest level seen since July 2018 according to the Glassnode data. Over the past 10 years, the amount of BTC that was held on exchanges increased continually but while there were a few dips, it kept on increasing. In 2018, it reached 2.3 million BTC and then kept rising for another year and a half, before reaching a peak of nearly 3 million BTC in 2020. After that, it shifted the direction.

For the rest of 2020, BTC was flying off of the exchanges and the total amount of BTC fell to $2 million which marks a 21% decline during this period. The frequency was increased in the past few days and the total amount of BTC decreased by 2.4% showing that a strong downtrend trend is forming. Jason Deane, the BTC analyst from Quantum Economics said:

 “The obvious conclusion is that it is being moved to long term cold storage, but it could also be a indication of improved awareness of security from more sophisticated users wary of the ‘not your keys, not your crypto’ mantra.”

Deane’s views are backed up by a few of the troubles that exchanges witnessed when Bitcoin started its record-breaking bull run. KuCoin for example, suffered a major hack back in September which resulted in the Exchange’s trading volume dropping by 21% the previous year. this could have caused investors to take their BTC off of the exchanges because they feared they got get hacked.

Others however believe that the drop indicates a positive future for BTC as CTO Rafael Schultze-Kraft from Glassnode, said that BTC will be moving into cold storage for the long-term and argued that this could lead to a supply crisis:

 “I think this is extremely bullish for the price of Bitcoin. Something we’re keeping our eyes on very closely.”

BTC shows more bearish signs below the $18,200 level and the $18,500 resistance level with the price trading well below the $18,500 and the 100 hourly simple moving average.