The amount of bitcoin (BTC), which was held on exchanges since the notorious Black Thursday on March 12th, has been steadily declining. It has now fallen to levels not seen since June 2013. The drawdown may also be due to recent “large” OTC transactions.
According to blockchain analytics firm Glassnode, the current drop in bitcoin balances on exchanges is “the longest and most sustained” such downtrend in bitcoin history. This brings the level to a one-year low.
The trend could indicate a longer-term outlook, as investors expect BTC to increase in price after the halving. However, another possible explanation is a lack of trust in exchanges. According to the firm’s latest report, It believes that withdrawing for hodling is having a more significant effect than the lack trust.
The report stated that this theory is supported by “continued increases in the number BTC whales” and “continued hodler accumulation over 2 months”.
Last week, the crypto market analysis firm Coin Metrics reported that the BTC holdings of BitMEX, and Bitfinex had fallen to new lows after the March 12th crash. Bitfinex last week held BTC 93 800, down from BTC 193,900 March 13th. BitMEX’s BTC supply was at BTC 216,000 last week, down from BTC 315 700 on March 13.
According to Bitfinex’s Chief Technology Officer, Paolo Ardoino OTC orders could have contributed to the substantial reduction in on-exchange balances.
“We had a number of OTC deals that were quite large, in which coins were removed from the platform. This led to a reduction of coins in our cold wallet. Ardoino stated that we act as an exchange, but also as a party in OTC deals.
BitMex didn’t respond to our request for comment.
According to analytics provider into the Block, 79% of bitcoin wallets are “in the cash” right now. This is a bullish sign for any asset and indicates that investors will likely keep their holdings in anticipation to further price increases.
Additionally, there has been an increase in wallets in the money, which has also boosted sentiment among bitcoin owners.
At USD 9,779.9, bitcoin had risen more than 1% in the last 24 hours. This gains come after several days of strong performance, which saw bitcoin rise nearly 12% over the past seven days.