The bitcoin (BTC) price has been in a deep trough for some time. Investors are waiting for the bottom, but no one knows where it is. Nevertheless, we are seeing some cautious positive signs here and there. so let on chain analysis platform Santiment yesterday showed in a tweet that the bitcoin balances on exchanges are declining.
Bitcoin balances exchanges are declining rapidly
Where the bitcoin offer on exchanges like Binance in May, when the price made a deep dip, we now see the opposite happening. Santiment shows this on the basis of on-chain data.
On-chain data is data coming directly from the Bitcoin blockchain. Using this information, Santiment shared the following chart yesterday:
“The supply of Bitcoin on exchanges has fallen rapidly. Following an uptick in panic selling in early May, this is an indication that hodlers who continued to believe in BTC during this decline are currently content with the volatile markets and willing to sit out.”
#Bitcoin‘s supply on exchanges has dropped rapidly. After an uptick of panic sells in early May, this is indicative of hodlers who stuck with $BTC through this downfall being content with volatile markets at this point, and willing to ride it out. https://t.co/aSQ9iChLJH pic.twitter.com/6KKHCAdSNi
— Santiment (@santimentfeed) June 18, 2022
0.6% of total bitcoin supply flowed away from exchanges
The graph shows that after the increase in May, the supply has actually only decreased. This is generally seen as a positive development.
There was, however, a small increase in inflows when the price recently fell just as hard. But over the past five days, no less than 0.6% of the total number of bitcoins in circulation is said to have flowed away from the crypto exchanges!
Whether this is ultimately a signal that the selling pressure is waning remains to be seen. On the positive side, of course, the recent declines have not yet resulted in a huge increase in bitcoins sent to exchanges.
Yesterday, the BTC price plunged below the hugely important price zone of $20,000. But at the time of writing, the price manages to recover somewhat and test this price level. A recovery above could be a positive sign.
