Current data from CryptoQuant as of August 7th shows that few bitcoin holders are removing their coins from centralized cryptocurrency exchanges like Binance and Coinbase. Although BTC prices have been surging in the past few weeks and oscillating near the psychological $30,000 mark, this observation is accurate.
More bitcoin held in exchanges
As of July 28, there were 30,663 addresses withdrawing coins from exchanges, although prices were relatively higher, trading at around $28,000, versus around $25,000 on June 14, when 39,311 addresses transferred coins. On April 14, when BTC was changing hands at around $30,000, 132,237 addresses withdrew the coin from exchanges.
The decline in the number of exchange addresses transferring coins to external, often non-custodial, wallets may be a cause for concern, especially as prices rise.
Bitcoin Exchange Withdrawal Addresses – All Exchanges| CryptoQuant
The shift also raises important questions as to why more Bitcoin holders are choosing to store coins on exchanges, even though these ramps are the target of hackers. If fewer people are transferring their bitcoins to external, often non-custodial, wallets, it could mean they are uncertain about the upside. Hence, they keep their coins on exchanges to quickly sell them against USDT or traditional currencies like USD or Euro if needed.
Optimism abounds
Despite this change, the broader bitcoin community remains positive about the coin’s potential in the coming months. This optimism is due in part to recent classifications by agencies such as the Securities and Exchange Commission (SEC) and the Commodity Futures Trade Commission (CFTC) specifically endorsing Bitcoin as a commodity subject to capital gains tax.
Other digital assets like ETH have not been categorized as such, raising doubts among some Ethereum holders that US regulators can classify the second most valuable coin as a security.
Because of this positive outlook for the world’s most valuable coin, advanced derivatives are being developed, such as BlackRock’s planned launch of a spot bitcoin exchange-traded (ETF) fund (if approved). Complex bitcoin trading products are already available in Canada and other parts of the world.
Analysts at Bloomberg Intelligence say the chances of a Bitcoin ETF getting SEC approval are high 65% The surge is partly due to bullish advances, including SEC Chairman Gary Gensler’s comments on Bitcoin, who reportedly insisted BTC was the only commodity before Coinbase was sued, and the ETF’s acceptance of a re-filing of BlackRock through the agency.
While Bitcoin’s upcoming halving in 2024 could be good news, Bloomberg analysts argue that the expected bounce appears to be “priced in”. based to “earlier cycles”. Subsequently, analysts anticipate that BTC could surge to $50,000 by April 2024, looking at the price action over the past few months.
BTC price on August 7| Source: BTCUSDT on Binance, TradingView
BTC price on August 7| Source: BTCUSDT on Binance, TradingViewFeatured image by Canva, chart by TradingView
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