Bitcoin disappears from exchanges during the cryptocurrency bull market
Only 13% of the total Bitcoin (BTC) supply is stored on exchanges, according to a study by Kraken. This is the smallest amount of the cryptocurrency in the custody of brokerages in over three years. The move of BTC withdrawals from exchanges coincides with the rise in the price of Bitcoin.
There is a direct correlation between the price of the asset and the volume that is available at brokerage firms. When the price of bitcoin goes up, it is common for it to be drained from these companies. Between 2017 and 2018, bitcoin soared and reached almost $20,000. At that time, there was an even more intense outflow of currencies from brokers.
Then, when the price of the cryptocurrency started to fall, it was accumulated again on exchanges. The trend was reversed only in 2020, when crypto went up sharply.
Bitcoin offerings on exchanges fell after Bitcoin appreciation (Kraken)
Among the reasons that can justify the phenomenon, is the increased market interest in bitcoin. The price of the currency has surpassed $60,000, making some investors optimistic about an even more significant price hike.