A report from data analysis website, Glassnode has indicated that the majority of the Bitcoin traders in the market are currently holding their assets which means a new Bitcoin surge might be incoming. In the report, the data analysis platform notes that the number of Bitcoin that is currently on crypto exchanges has been on a reduction spree as investors and traders alike have chosen to hold on to their assets.
A statistical analysis that spans across months since the “Black Thursday” event where Bitcoin lost half of its value to trade at around $3,000 from $7,000 backs this up. The Friday that followed saw a further decline of the digital assets before it began another round of upward movement. Crypto exchanges experience fall in amount of Bitcoin Glassnode has confirmed that the total number of Bitcoin that is currently on crypto exchanges has fallen to a tune of $2.85 billion which is equal to about 2,700,000 BTC from its previous stance of $2,900,000 BTC. With data analysis backing this development up, the next question should what is the main trigger behind this reduction in Bitcoin on crypto exchanges?
Analysts have pointed out that the first major factor that contributed to this latest development is the lack of trust in crypto exchange by investors and traders. This month has witnessed the indictment of the four co-founders of BitMEX and the arrest of Star Xu, the founder of OKEx. Looking closely at another reason, analysts have pointed out that sellers are presently unwilling to sell Bitcoin at the moment. Majority of the sellers are currently hodling their assets and waiting for the nearest big break where they would be able to cash in on their profits.
“Traders have been accumulating Bitcoin for the past few months which has contributed to the scarcity of sellers of Bitcoin”, the Glassnode report says. Traders hodl Bitcoin in preparation for a bullish trend However, Glassnode has mentioned that a larger part of the larger part of Bitcoin in circulation has already been moved into various accumulation addresses. Accumulation addresses are wallets that exist for the sole aim of just receiving Bitcoins; the digital assets are never transferred out of the wallets.
The addresses have at least two incoming transactions and have never sent any Bitcoin for years. “Bitcoin accumulation is not something that just started yesterday, it has been going on for years, but this recent data shows that $2.6 million worth of Bitcoin which is 14% of the current supply is currently held in the various accumulation wallets.
To back up this claim, a popular commenter for crypto Twitter, @oddgems said, “more and more #Bitcoin getting out from exchanges and most probably being transferred to non-custodial wallets. This suggests slightly lower liquidity and lower selling pressure going forward.” Presently, the Bitcoin fear and greed index has tilted towards greed with this showing that most investors and traders are trying to build up the BTC reserves by just buying alone. This current holding by the majority in the crypto market means that most of the traders want to enjoy the profit when the expected bullish trend begins.