Following a major price decline in Bitcoin (BTC), market sentiment back to strong levels of fear, indicating that investors are becoming increasingly cautious and risk-averse. Despite this trend, on-chain data analytics provider CryptoQuant has revealed a significant increase in BTC buying momentum, resulting in the Bitcoin balances on various exchanges dropping to six-year lows.
Bitcoin Reserve On Exchanges Sees Sharp Plunge
With ongoing market volatility and the recent decline in Bitcoin, on-chain data has identified a significant shift in the cryptocurrency’s market activity. CryptoQuant’s has revealed a substantial decline in the total amount of Bitcoin held by various Centralized Exchanges (CEXs) in the market.
As of October 2, the , according to Coinglass, at 2.34 million, marking the lowest number in six years. This sharp decline contrasts with the 3.05 million Bitcoin held on exchanges in January this year, highlighting a significant reduction in available supply in just a few months.
Typically a low Bitcoin balance on centralized exchanges could be an indication of an impending price appreciation, as fewer BTC available on these platforms can create upward pressure on its price due to the limited supply. The reduction in Bitcoin reserves could also be signaling a shift in investor sentiment from selling to accumulating.
Following Bitcoin’s price drop to around $60,000, various exchanges experienced mass withdrawals from investors. In one of its QuickTake blogs, CryptoQuant this large-scale withdrawal as “the largest outflow of Bitcoin from exchanges since November 2022.”
This development also follows the recent in Bitcoin accumulation by whales and a rise in the demand for Spot Bitcoin Exchange Traded Funds (ETFs). Additional information from CryptoQuant that institutional investors moved from net selling 5,000 BTC on September 2 to buying 7,000 BTC by the end of the month. This represents the highest daily purchase of Spot Bitcoin ETFs since July 21.
demand from US spot ETFs is rising. They went from net selling 5K on Sept 2 to buying 7K BTC at September’s end—the highest since July 21. In Q1 2024, spot ETFs bought nearly 9K daily, boosting prices to new highs. If this trend continues, prices may rise… — CryptoQuant.com (@cryptoquant_com)
Moreover, in the first quarter of 2024, Spot ETFs were reportedly buying nearly 9,000 BTC daily, boosting prices to new levels. CryptoQuant also disclosed that if this increase in demand continues, the price of Bitcoin may appreciate further.
Analyst Stays Bullish On BTC, Predicts $100,000 Surge
A popular crypto analyst, known as ‘The Bitcoin Therapist’ on X (formerly Twitter) has a massive bull flag in Bitcoin’s price chart. The analyst revealed that this bull flag had formed over the last seven months, signaling a potential for a price increase in the future.
Sharing a video representation of his Bitcoin chart analysis, the analyst disclosed that if the price of BTC can break above the $66,000 resistance level, it could skyrocket to new all-time highs around $80,000 to $90,000. He also expressed a strong bullish sentiment on Bitcoin’s future price, predicting an even higher price surge to $100,000.
Featured image from CNN, chart from TradingView