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Only 1.3 Million Bitcoin is Now Available on Crypto Exchanges

As Bitcoin moved above the key $50k level, several new statistics showed that the cryptocurrency is currently undergoing a supply shock and that it investors are rapidly buying the crypto and moving it away from the centralized exchanges for the last year or so. So much Bitcoin has now been siphoned away from the trading outlets that analysts show that just around 1.3 million Bitcoin (6.8% of the supply) is left on these exchanges. This means that much of the world now has this much Bitcoin to invest on and that means it might appreciate more because of this supply situation.

 

Exchange Reserves Drop to New Low

 

According to crypto analytics user CryptoRank on Twitter, the trend of crypto being pulled out of exchanges is nothing new and has been occurring since the last block reward halving in May 2020. The exchange wallets held as much 9.5% of the total supply back in October last year and slowly, but surely, the trend has been continuing on.

Crypto Rank Tweeted:

 

 

Also, CryptoRank noted that Coinbase’s share of proceedings is also decreasing overall. It used to hold a majority of all crypto held by exchanges, recording an impressive 50.52% just last year. However, this year around, Coinbase’s share has fallen to around 40.65%. Binance follows Coinbase with a share of around 25% while fellow Bitfinex crypto exchange holds 14.5% of the overall value. Together, this trinity holds almost 80% of the total exchange supply, which is a massive amount and shows just how difficult it is for new exchange platforms to enter the segment and take a hold of it.

 

Is a Christmas Rally still in the Cards?

 

Bitcoin’s recent rise coupled with some positive indicators mean that the bulls can draw some confidence from the current setup. However, another indicator shows that the cryptocurrency can still face some bearish pullback if some whales (big holders) get out of cold storage and then sell it on these exchanges. The Whale Ration Indicator is currently at one year highs, meaning whatever Bitcoin is being transferred to the exchanges, the whales now constitute a large part of it. While many of these big holders haven’t sold their crypto, there are chances that they have a certain range or figure in mind. When this level will be achieved, they would want to liquidate their digital currency holdings. So, despite the current setup, bulls are nervous going forwards and falling into a bearish trap triggered by the whales.

 

Image Source: pixabay.com

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