Bitcoin News

Few Bitcoin Holders Withdrawing BTC From Exchanges, Is Fear Creeping In?

Recent data from CryptoQuant on August 7 reveals that a smaller number of Bitcoin holders are moving their coins away from centralized cryptocurrency exchanges like Binance and Coinbase. This observation comes despite the recent increase in BTC prices, with the cryptocurrency hovering close to the $30,000 psychological level.

On July 28, when BTC was trading around $28,000, there were 30,663 addresses withdrawing coins from exchanges. This number was down from the 39,311 addresses that moved coins on June 14 when prices were around $25,000. Furthermore, on April 14, when BTC was valued at around $30,000, a significant 132,237 addresses withdrew the coin from exchanges.

The decrease in the number of exchange addresses moving coins to external, non-custodial wallets can be a concern, especially during a price uptrend. This shift raises questions about why more Bitcoin holders choose to store their coins on exchanges, despite the risk of exchanges being targeted by hackers. It is possible that some holders prefer keeping their coins on exchanges to quickly sell them for USDT or traditional currencies like USD or Euro if needed, indicating a sense of uncertainty about the current uptrend.

Nevertheless, the broader Bitcoin community remains optimistic about the coin’s potential in the coming months. Recent classifications from regulatory agencies like the Securities and Exchange Commission (SEC) and Commodity Futures Trade Commission (CFTC), endorsing Bitcoin as a commodity subject to capital gains tax, contribute to this positive outlook. In contrast, other digital assets like Ethereum are still not classified as commodities, causing doubts among some Ethereum holders regarding their regulatory status.

Amid this positive sentiment, advanced derivatives like BlackRock’s planned launch (if approved) of a spot Bitcoin Exchange-Traded Fund (ETF) are in development. Complex Bitcoin trading products are already operational in Canada and other parts of the world. Bloomberg Intelligence analysts estimate a 65% chance of the SEC approving a Bitcoin ETF, citing bullish progress, including SEC Chair Gary Gensler’s favorable comments on Bitcoin and the regulator’s assertion that BTC is the only commodity.

While the upcoming halving of Bitcoin in 2024 is anticipated to be positive news, Bloomberg analysts suggest that the expected upswing may already be “priced in” based on previous cycles. They predict that BTC may rally to $50,000 by April 2024, considering recent price performance trends. Despite some uncertainties, the overall outlook for Bitcoin remains optimistic, with investors and analysts looking forward to potential growth and regulatory developments in the crypto space.


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