Data on the chain shows that the Binance platform’s Bitcoin exchange has plunged recently, and this sign may be the price of BTC.
Bitcoin second-hand exchange reserves have collapsed recently
As analysts pointed out in a crypto-fast post, Binance’s Bitcoin exchange reserves have dropped sharply since mid-April. The “trading reserve” here refers to an indicator that tracks the total number of BTC sitting in a given centralized exchange wallet.
When the value of the indicator rises, this means that investors are storing the net amount of assets into the platform. One of the main reasons for transferring coins to exchanges as holders is that for sales-related purposes, this trend may have a bearish effect on the price of cryptocurrencies.
On the other hand, the observed decline indicator indicates that outflows overwhelmingly with net assets leaving exchanges. Such a trend may indicate that investors are accumulating, which can naturally be bullish on BTC.
Now, the following chart shows the trends in cryptocurrency exchange binary bitcoin exchange reserves over the past few years:
Looks like the value of the metric has plummeted in recent days | Source: CryptoQuant
As shown in the above chart, Bitcoin binary exchange reserves have followed a steep downward trajectory since mid-April, meaning investors are already in net withdrawal mode.
In total, the platform saw an outflow of about 51,000 BTC ($4.8 billion) during this period. Given the large number involved, the whale-sized holder may be behind the action.
The latest massive outflows of these exchanges are accompanied by a rally of recovery in BTC prices. As can be seen from the chart, a similar trend has also occurred in the last two months of 2024.
At that time, the Bitcoin Bull Run reached its peak at about the same time as the bottom in the metrics. With this trend in mind, as long as current exchange reserves continue to decline, the gathering of asset prices may also continue.
That is, in today’s market, communication is no longer as important as before due to the emergence of other gateways such as spot exchange-traded funds (ETFs). So while exchange withdrawals may still be a bullish sign, BTC will come down to what other parts of the industry look like.
BTC price
Bitcoin returned to the $97,000 level a few days ago, but since then, the coin seems to face a pullback as it dropped to $94,000, starting a new week.
The price of the coin appears to have erased some of its recent recovery | Source: BTCUSDT on TradingView
Featured images from dall-e, charts from cryptoquant.com, tradingview.com
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