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Breaking News: Celsius Founder Alex Mashinsky Receives 12-Year Prison Sentence

What Sell Pressure? Bitcoin Exchange Reserves Hit 4-Year Low

Best Owie
Best Owie
3 years ago
3 mins read
Bitcoin

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Bitcoin has started a recent downtrend that is threatening its position above the coveted $40,000 level. This is presumed to be caused by major sell-offs in the market. However, exchange metrics continue to show that this is not entirely the case. Exchange balances have been plummeting for the past year pointing towards massive accumulation trends and this has come to a head after bitcoin exchange balances have touched a new 4-year low.

Exchange Balances Plummet

It is no secret that the bitcoin being left on centralized exchanges has been declining. However, the margin by which this has been on the decline is more important. Even during times when the price of bitcoin had been on a recovery trend and headed into a bull market, exchange balances continued to plummet. The result of this has been exchange balances hitting a new low, currently sitting at a four-year low.

Related Reading | Why A “Boring” Bitcoin Could Be A Good Thing

This comes from months of consistent outflows that have been the order of the day. Even when bitcoin had reclaimed its position above $40,000 on several occasions, exchange outflows continued to surpass inflows, leading to the decline in the balances.

Bitcoin price char from TradingView.com

BTC trading south of $40,000 | Source: BTCUSD on TradingView.com

One of the most prominent outflows was recorded on April 14th when more than 25K bitcoin valued at $1.9 billion left centralized exchanges in a single day. The decline to 4-year lows was made public by on-chain data aggregation firm CryptoQuant in a tweet on Thursday. 

$BTC Spot Exchanges' Reserve hits over a 4-year low

Live Chart👇https://t.co/52cmYEeYFo pic.twitter.com/BqB7koB5i0

— CryptoQuant.com (@cryptoquant_com) April 21, 2022

Bitcoin Outflows Not Slowing Down

Despite hitting a new low, bitcoin investors are not letting up in their outflow activities. Wednesday, April 20th saw bitcoin outflows touch as high as $1.3 billion, continuing the same trend as that recorded on April 15th. 

Related Reading | Bitcoin Falls Back To $40,000 As Fed Mulls Faster Rate Bumps

This carried on into Friday with a total of $1.7 billion in outflow already recorded for the digital asset in the last 24 hours. As the weekend draws close, a time when volatility can be quite low, the market may see the pioneer digital asset recover above $42,000 once more. 

📊 Daily On-Chain Exchange Flow#Bitcoin $BTC
➡️ $1.4B in
⬅️ $1.7B out
📉 Net flow: -$315.5M#Ethereum $ETH
➡️ $557.2M in
⬅️ $524.1M out
📈 Net flow: +$33.1M#Tether (ERC20) $USDT
➡️ $647.2M in
⬅️ $668.5M out
📉 Net flow: -$21.4Mhttps://t.co/dk2HbGwhVw

— glassnode alerts (@glassnodealerts) April 22, 2022

The rate at which BTC is leaving exchanges suggests one thing and that is that investors are accumulating their cryptocurrencies. This has already been the case among whales but it seems like smaller investors are beginning to follow the same path.

Featured image from IG, chart from TradingView.com
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Best Owie
Best Owie

Best Owie

Best Owie is a seasoned managing editor with a wealth of experience currently serving as the Managing Editor at NewsBTC. Best is a highly skilled professional with a track record of producing engaging and informative content. With a keen eye for detail and a passion for accuracy, Best is committed to ensuring that each article published meets the highest standards of quality.

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Best has over six years of experience in the crypto industry and has overseen the creation and publishing of thousands of articles over the years. Best is always abreast of everything that is going on in the crypto industry in order to create and curate the most relevant content for readers. This shines through in Best’s publications, which are always clear and concise, enabling easy reading and understanding for all.

Best is also an avid learner and advocate for new technology. This has seen Best dive into topics in areas such as decentralized finance (DeFi), non-fungible tokens (NFTs), Layer 2 blockchains, etc. In addition to this, Best is a vocal member of the crypto community across various social media platforms such as X and Reddit. Best’s work garners tens of thousands of readers monthly, who rely on the information in these publications to keep up-to-date with everything happening in the crypto community.

Best’s articles explore breaking news, intricate systems such as yield farming, liquidity pools, and other decentralized finance (DeFi) systems. This is because Best understands the importance of information to gaining financial freedom and believes that everyone should have access to this information.

Best also believes in leveraging the blockchain for philanthropy to create the most positive social impact. This involves work with charitable organizations focused on financial literacy and education. With each article, Best lends a voice to important issues such as a more financially inclusive future, transparent systems for growth and development, and technology that is not self-serving but one that serves all of humanity.

When not curating engaging content, Best can be found reading a book with a cup of hot chocolate, enjoying a Netflix series, or exploring the outdoors with Green - the world’s most quiet and well-behaved Husky. Best’s interests also span other industries such as art, finance, and security, attending seminars and conferences in not just the crypto industry but other industries as well.

As an animal lover, Best is also involved with charities for animals, local shelters, and rescues. Best is also involved in local events that promote inclusivity, such as being a prominent member of hiking clubs and a cycling club, as well as being a part of a very happy group of animal lovers.

Best is a true professional in every sense of the word, with an exceptional dedication to producing high-quality work. This shines through in Best's work on and off the clock. These include advocating for inclusive crypto education for all, the impact of financial illiteracy, and the benefits of adopting new technologies such as cryptocurrencies. Best’s prolific career in the media industry is a testament of how hard work and dedication pays.

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