As an analyst with extensive experience in the cryptocurrency market, I find myself intrigued by the recent developments in Bitcoin (BTC). The significant decline in the amount of BTC held by centralized exchanges and the surge in institutional buying suggest that we may be witnessing a shift in market dynamics.
After a substantial drop in Bitcoin (BTC) prices, investor sentiment has moved towards high levels of worry, showing that they are growing more cautious and risk-adverse. However, CryptoQuant, an analytics provider for on-chain data, has observed a notable surge in BTC buying activity, leading to the Bitcoin balances on various exchanges hitting their lowest point in six years.
Bitcoin Reserve On Exchanges Sees Sharp Plunge
Amidst continuous market fluctuations and the recent drop in Bitcoin’s value, on-chain analysis has pointed out a notable change in Bitcoin trading behavior within the cryptocurrency market. Data from CryptoQuant shows a considerable reduction in the amount of Bitcoin that centralized exchanges (CEXs) are holding.
Since October 2nd, as reported by Coinglass, the amount of Bitcoin held by centralized exchanges reached 2.34 million BTC, which is the lowest figure in six years. Compared to the 3.05 million Bitcoin stored on these platforms in January this year, it shows a substantial decrease in available supply within just a few short months.
Generally speaking, having less Bitcoin on centralized exchanges might suggest an upcoming price increase. This is because when fewer Bitcoins are available on these platforms, there’s less supply, which can drive up the price due to increased demand. Additionally, a decrease in Bitcoin reserves could indicate that investors are shifting from selling to buying, signaling a change in sentiment towards accumulating more Bitcoin.
After a significant decrease in Bitcoin’s price to approximately $60,000, numerous investment platforms saw a surge of withdrawals by users. In its QuickTake article, CryptoQuant characterized this widespread withdrawal as the “biggest movement of Bitcoin off exchanges since November 2022.
This trend in development is consistent with the recent surge in Bitcoin hoarding by large investors (whales) and an upswing in requests for Spot Bitcoin Exchange-Traded Funds (ETFs). Further analysis from CryptoQuant indicates that institutional investors switched from selling 5,000 BTC on September 2 to buying 7,000 BTI by the end of the month, marking the highest single day purchase of Spot Bitcoin ETFs since July 21.
#Bitcoin demand from US spot ETFs is rising.
Initially, they were selling approximately 5,000 Bitcoin (BTC) on September 2, but by the end of September, they switched to purchasing around 7,000 BTC – which is the most significant buying since July 21.
In Q1 2024, spot ETFs bought nearly 9K #BTC daily, boosting prices to new highs.
If this trend continues, prices may rise…
— CryptoQuant.com (@cryptoquant_com) October 4, 2024
Furthermore, it’s been reported that Spot ETFs were purchasing approximately 9,000 Bitcoins each day during Q1 of 2024, driving prices to unprecedented highs. If this trend in demand persists, CryptoQuant predicts the value of Bitcoin could potentially rise even more.
Analyst Stays Bullish On BTC, Predicts $100,000 Surge
A well-regarded cryptocurrency expert, frequently referred to as ‘The Bitcoin Counselor’ on platform X (previously Twitter), has identified a substantial bull flag pattern in Bitcoin’s price graph. This analyst explained that this bull flag had been developing over the past seven months, suggesting a possibility of an upward price trend in the future.
The analyst showed his Bitcoin price chart analysis in a video and hinted that if the price manages to surpass the barrier of $66,000, it might reach unprecedented peaks between $80,000 and $90,000. Moreover, he holds a very optimistic view on Bitcoin’s future value, forecasting another significant increase that could take it up to $100,000.
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2024-10-06 07:16