Key Takeaways:
- Bitcoin experiences a historic 80% decline in the number of addresses logging inflows, reflecting an unprecedented shift in market behavior.
- Bitcoin reserves on exchanges have dropped over 30% since March 2020, marking the first period of consistent decline in Bitcoin’s history.
- Recent ETF filings by BlackRock and the introduction of new regulatory frameworks among the G20 could be signaling an evolving and positive perception of Bitcoin.
In a landmark trend, Bitcoin is witnessing a record 80% drop in the number of addresses logging inflows, which effectively suggests inferred selling. This data, measured since October 2021, escalates to an 84% decline when considering the period from May 2021.
For context, this outpaces the 78.5% decline experienced after the 2017 parabolic top into the 2018 bear market. One of the explanations for this decline could be the migration of addresses towards self-custody solutions, rendering them less traceable in terms of inflows. The decline might also be attributed to the varying activity levels of miners or retail traders.
Simultaneously, a substantial shrinking in Bitcoin supply on exchanges has been observed. Since March 2020, there has been an over 30% decline in Bitcoin reserves on exchanges. This is both significant in duration and magnitude.
Notably, March 2020 marked the peak of Bitcoin supply on exchanges, and what followed was an unprecedented contraction over 1200 days. This is in stark contrast to the consistent growth in supply witnessed over the preceding ten years.
This trend suggests an enduring and positive evolution in the general perception of Bitcoin. The decline in supply on exchanges might be indicative of investors preferring to hold onto their Bitcoin, perceiving it as a valuable asset.
This sentiment is further bolstered by financial giants like BlackRock filing for Bitcoin ETFs. Moreover, the G20’s inclination towards introducing crypto regulatory frameworks signals maturation in market perception.
All in all, the significant contraction of Bitcoin inflows and the shrinking supply on exchanges indicate a potential paradigm shift in the cryptocurrency landscape. The market appears to be evolving, with a more positive perception and greater confidence in Bitcoin as a long-term investment.
Source
https://twitter.com/cryptoquant_com/status/1675742126192336897?s=20
