Bitcoin appears to be struggling to position itself above $60,000. The world’s largest crypto asset by market cap is yet to recover from the fall earlier this week. As a result, its weekly losses compared to the surge last Friday stand at about 10%.
However, its reserves on exchanges hitting new lows for the year paints a bullish picture.
Bitcoin’s Dwindling Exchange Reserves
As per CryptoQuant’s observation, bitcoin’s decrease in reserves suggests reduced selling pressure, which could pave the way for a bullish market if demand continues to rise. A significant factor contributing to this decline is the growing trend of self-custody, the report noted. This means that more investors are opting to store their BTC in cold wallets, ensuring greater control over their assets.
With fewer bitcoins available on exchanges, liquidity diminishes, thereby making immediate sales less feasible. Such a pattern reflects a market dominated by long-term investors, who are increasingly inclined to hold onto their assets in anticipation of future price appreciation.
As a result, the market becomes more resilient, with reduced susceptibility to sudden panic-induced sell-offs.
Meanwhile, long-term holders have increased their supply by 262,000 BTC in the past 30 days. As per CryptoQuant’s data, this cohort of bitcoin holders is now controlling 14.82 million BTC, or 75% of the total supply. This growing dominance indicates a strong conviction among investors, who are holding onto their assets despite negative market conditions.
A Buying Opportunity for Bitcoin Investors
The current hash price, which reflects miner profitability, has dropped to its lowest levels, as revealed by the on-chain analytic platform’s other analysis. Historically, such periods have coincided with bitcoin price bottoms, suggesting that the current low hash price might indicate that the crypto asset is near the bottom as well.
This could present a strategic buy opportunity for investors, further reinforcing the potential for a much-needed market rebound.
