The number of Bitcoin held on crypto exchanges is lower than it has been in years. A cause for concern or a serenity?
Considering the past week and the one on September 13, 2021 from Glassnode published Weekly review, the question arises: is there cause for concern or calm in the Bitcoin orbit?
Because since March 2020, as a graphic by Glassnode shows, the share of Bitcoin held on the stock exchange has fallen dramatically. In the past week, the proportion reached a point that it last had in February 2018. At that time, Bitcoin experienced the first major mainstream hype, today it is hard to imagine the world without cryptocurrency. Nevertheless, the share of Bitcoin held by trading platforms is (almost) the same then as it is now: 13.1 percent.
That number was enough to spark a discussion on Twitter. Is it a good or bad sign that the exchanges only hold 13 percent of Bitcoin?
A positive development?
According to Glassnode, this development is more of a cause for calm. The results from the newsletter The Week on Chain (Week 37, 2021) give reason to believe that the decline in Bitcoin traded on exchanges is more due to the fact that many large transactions were and are being transferred to cold wallets.
This means that a large number of coins are not used for acute speculative trading, but that the owners plan to hold the coins for a longer period of time. Or as the Bitcoin orbit says, to have the coins.
Twitter user @JedKelly is about that opinionthat “if the inflow continues to trend downwards, we will see a sharp rise in prices” – and vice versa.
Differentiated results of the investigation
Glassnode fundamentally processes data in order to make blockchain products easier to understand for investors. In the chart presented here from the newsletter The Week on Chain (Week 37, 2021) is about the “percentage credit on exchanges”. In the study, Glassnode has, among other things, pre-buttoned the dynamics of the on-chain Bitcoin offer and comes to the following results:
- That average age of bitcoin, who are traded daily, was comparatively young in the past week
- the rest time Bitcoin is growing: According to Glassnode, that means that the market has a preference for the longer term
- What lies, that lies: According to Glassnode, there is on the stock exchanges little bitcoin growththat are already in Cold wallets have been secured
- The number of longer than Bitcoin held for 155 days is bigger than ever: According to Glassnode, there were 12.97 million Bitcoin in the past week.