Bitcoin Holding on Exchanges Drops by 4.1%
Data from CryptoQuant reveals that the amount of bitcoin held on centralized cryptocurrency exchanges decreased by 4.1% this month, a sign that could indicate increased investor confidence in the digital asset. As of the end of August, centralized exchanges held 2,010,346 bitcoins, down 86,305 from the beginning of the month, which is the lowest reserve level since January 2018. The declining supply of bitcoin on exchanges suggests that investors are confident in the long-term prospects of bitcoin, and may also indicate that traders are waiting for more favorable market conditions before executing sell orders.
Investors Exhibit Assurance by Transferring Bitcoin to Cold Wallets
Adam Mourad, a data analyst at CryptoQuant, noted that the significant transfer of Bitcoin from exchange platforms to secure cold wallets demonstrates the confidence shown by long-term investors. Mourad explained that this move can be seen as an attempt by investors to protect their capital from ongoing market instability. He also highlighted a significant outflow of BTC that coincided with a positive price trajectory after a U.S. appeals court ruled in favor of Grayscale on a Tuesday. Following the price surge, more than 20,000 bitcoins were transferred from exchanges into cold wallets, which, according to Mourad, suggests that investors perceive the market as still undergoing a corrective phase. However, he added that this action signifies a belief in the enduring value of Bitcoin.
Bitcoin Price Experiences Minor Drop Amidst Critical Testing Phase
Despite its recent breakout, the price of bitcoin, the world's largest cryptocurrency by market capitalization, experienced a 2% decline over the past 24 hours, dropping to $26,370 at 1:15 p.m. ET, according to CoinGecko. This price movement indicates that bitcoin is currently hovering around a critical testing ground.
