The bitcoin market appears to have taken an intriguing turn as reserves of the asset on centralized exchanges have reached the lowest levels since November 2018.
This development, <a target="_blank" href="https://cryptoquant.com/insights/quicktake/67370c01ab1574666196be86-btc-reserves-on-exchanges-hit-lowest-since-November-2018″ target=”_blank”>highlighted by a CryptoQuant analyst known as G aah, points out a notable change in btc investor behavior within the crypto space and also suggests a rather interesting trend for bitcoin.
bitcoin reserves on exchanges hit five-year low
According to the analyst, bitcoin reserves on exchanges have decreased significantly throughout 2024, reflecting a shift toward long-term holding strategies among market participants.
<img src="https://technicalterrence.com/wp-content/uploads/2024/11/Bitcoin-exchange-reserves-hit-their-lowest-level-in-5-years.png" alt="bitcoin (btc) Exchange Reserve.” />
This trend suggests that investors are increasingly moving their assets into private portfolios, reducing the supply available for immediate sale and contributing to buying pressure in a market that is already supply-constrained.
According to G aah, this behavior indicates a broader shift in sentiment, as market participants show greater confidence in bitcoin as a store of value amid “economic uncertainty and rising inflation.”
By moving bitcoin away from exchanges, investors reduce the likelihood of sudden sell-offs, which can lead to greater price stability. However, reduced supply on exchanges can also lead to greater volatility, especially if demand continues to grow or remains constant.
The CryptoQuant analyst noted:
That said, this scenario indicates a potentially more volatile but more resilient bitcoin market, with less selling pressure and increasing dominance from long-term holders, which could open up room for new price peaks.
btc Upward Momentum Cools
Following an all-time high (ATH) of $93,477 on Wednesday, November 13, btc has faced a rather notable correction, now down 4% from this peak. The asset has so far failed to continue its bullish momentum and appears to be experiencing further sell-offs.
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As of this writing, bitcoin is trading below $90,000 with a current trading price of $89,779, down 1.4% over the past day. This price drop resulted in approximately $49 billion being subtracted from its market capitalization valuation on Wednesday.
For context, as of today, btc's market capitalization stands at $1.775 trillion, a decrease of almost 5% from the $1.835 trillion valuation two days ago. bitcoin's daily trading volume fell from more than $100 billion earlier this week to less than $85 billion.
In addition to the implications on its market capitalization and trading volume, btc's decline has significantly affected a handful of traders. According data According to Coinglass, in the last 24 hours alone, approximately 170,215 traders have been liquidated, bringing the total liquidations in the crypto market to $510.13 million.
<img class="wp-image-653372 size-large" src="https://technicalterrence.com/wp-content/uploads/2024/11/1731788116_469_Bitcoin-exchange-reserves-hit-their-lowest-level-in-5-years.png" alt="Total liquidation in the crypto market” srcset=”https://www.newsbtc.com/wp-content/uploads/2024/11/Screenshot-2024-11-15-at-15.30.38.png?w=1624 1624w, https://www.newsbtc.com/wp-content/uploads/2024/11/Screenshot-2024-11-15-at-15.30.38.png?w=460 460w, https://www.newsbtc.com/wp-content/uploads/2024/11/Screenshot-2024-11-15-at-15.30.38.png?w=768 768w, https://www.newsbtc.com/wp-content/uploads/2024/11/Screenshot-2024-11-15-at-15.30.38.png?w=860 860w, https://www.newsbtc.com/wp-content/uploads/2024/11/Screenshot-2024-11-15-at-15.30.38.png?w=1536 1536w, https://www.newsbtc.com/wp-content/uploads/2024/11/Screenshot-2024-11-15-at-15.30.38.png?w=750 750w, https://www.newsbtc.com/wp-content/uploads/2024/11/Screenshot-2024-11-15-at-15.30.38.png?w=1140 1140w” />
Of these total liquidations, bitcoin accounts for $132.43 million, with the majority of liquidations coming from long positions, those that bet that the bullish momentum would continue.
Featured image created with DALL-E, TradingView chart
