Cryptocurrency

Bitcoin

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 <p class="paragraph">A 10-year historical trend has shifted for Bitcoin (BTC) <a rel="noopener noreferrer nofollow" title="exchange" href="https://thebittimes.com/tag/exchange.html">exchange</a> <a rel="noopener noreferrer nofollow" title="reserves" href="https://thebittimes.com/tag/reserves.html">reserves</a>. In the last three years, investors have been making more Bitcoin withdrawals than deposits on cryptocurrency <a rel="noopener noreferrer nofollow" title="exchange" href="https://thebittimes.com/tag/exchange.html">exchange</a>s.</p>
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 <p class="paragraph">It is important to understand that BTC deposited on an exchange could become selling pressure at any time. This speculative supply offers an imminent sell-off threat that could negatively affect Bitcoin’s price action by neutralizing an incoming speculative demand.</p>
 <p class="paragraph">Moreover, when holders deposit their coins into an exchange, it is usually interpreted as an intention to sell. On the other hand, withdrawing to a self-custody Bitcoin wallet signals the opposite: An intention to “HODL.”</p>
 <p class="paragraph">Notably, from 2013 to 2020 Bitcoin exchange reserves have consistently grown, with investors and miners increasingly depositing BTC to trade or sell. However, a chart retrieved from <em>CryptoQuant Pro</em> shows the trend shift that has happened since the end of 2020.</p>
 <figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1024" height="645" src="https://cdn.thebittimes.com/images/2023/11/18/8f939fdb13328f27adbe286512488cce.webp" alt="Bitcoin: Exchange reserve - All exchanges." class="wp-image-138157" srcset="https://cdn.thebittimes.com/images/2023/11/18/8f939fdb13328f27adbe286512488cce.webp 1024w, https://cdn.thebittimes.com/images/2023/11/18/8f939fdb13328f27adbe286512488cce.webp 300w, https://cdn.thebittimes.com/images/2023/11/18/8f939fdb13328f27adbe286512488cce.webp 768w, https://cdn.thebittimes.com/images/2023/11/18/8f939fdb13328f27adbe286512488cce.webp 1280w" sizes="(max-width: 1024px) 100vw, 1024px">
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   Bitcoin: Exchange reserve – All exchanges. Source: <em>CryptoQuant</em>
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 <h2 class="wp-block-heading" id="h-how-many-bitcoins-are-in-exchange-reserves">How many Bitcoins are in exchange reserves?</h2>
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 <p class="paragraph">As of writing, there are around 2.04 million BTC ($73.3 billion) in <a rel="noopener noreferrer nofollow" title="exchange" href="https://thebittimes.com/tag/exchange.html">exchange</a> <a rel="noopener noreferrer nofollow" title="reserves" href="https://thebittimes.com/tag/reserves.html">reserves</a>. This number still represents more than 10% of Bitcoin’s current circulating supply, which is a high-weight speculative supply.</p>
 <p class="paragraph">Nevertheless, it also means that Bitcoin exchange reserves shed 32% since their highs of around 3 million BTC held by exchanges in 2020.</p>
 <p class="paragraph">Even with one of the historically highest speculative supply amounts, BTC was able to reach its all-time high price in 2021 due to a significantly higher speculative demand for the leading cryptocurrency.</p>
 <p class="paragraph">Interestingly, the lower the amount of Bitcoin held in <a rel="noopener noreferrer nofollow" title="exchange" href="https://thebittimes.com/tag/exchange.html">exchange</a> <a rel="noopener noreferrer nofollow" title="reserves" href="https://thebittimes.com/tag/reserves.html">reserves</a>, the lower the needed demand to trigger a bull market similar to two years ago. Additionally, it also means a reduced risk exposure for custodial catastrophes like what happened with FTX in 2022.</p>
 <p class="paragraph"><strong><em>Disclaimer:</em></strong><em> The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.</em></p>
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<p>Source: <a rel="noopener noreferrer nofollow" target="_blank" href="https://thebittimes.com/buckle-up-bitcoin-exchange-reserves-decline-since-2020-why-is-it-important-tbt70793.html">https://thebittimes.com/buckle-up-bitcoin-exchange-reserves-decline-since-2020-why-is-it-important-tbt70793.html</a></p>

Buckle up: Bitcoin exchange reserves decline since 2020; Why is it important?

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