With the fact that there can ever only be 22 million Bitcoin in circulation, BTC has always been bound to be scarce over time as the asset flourishes in mainstream adoption while its value continues to rise.
According to the latest data from the on-chain analytics firm, Glassnode, the amount of BTC that is dormant is beginning to surpass available Bitcoin for purchase on exchanges. Co-founder of Bitcoin-focused research firm Reflexivity, William Clemente, noted: “There is now more Bitcoin that hasn’t moved in at least 10 years than there is on exchanges.”
Bitcoin On Exchanges Less Than BTC That Are Dormant
The Glassnode data indicates there could be a fast accumulation of BTC which has now put the amount of BTC on exchanges in a down-only mode compared to BTC which is dormant. The rapid growth and adoption of the crypto market have made the industry more crowded than ever.
Compared to 10 years ago when buying BTC might be quite tasking, purchasing BTC in these modern days is now as fast and efficient as possible so that literally anyone on the internet can have access to the asset given the various number of Bitcoin exchanges in the market.
Coinmarketcap notes that there are over 500 exchanges in the market and more than 50% have Bitcoin listed. As of February 27, Glassnode revealed that there are only 2,272,798 BTC held by all exchanges combined.
This figure is relatively low compared to the amount of BTC that is dormant for 10 years or more which is 2,645,956 BTC accounting for 16% more than BTC on exchange reserves. Notably, the number of BTC held on exchanges hit an all-time high of 3,202,326 BTC as of March 2020 and has plummeted ever since.
BTC Gearing For A Bearish Move?
While Bitcoin has been experiencing a change in circulation, the asset’s value hasn’t been left out. Since the beginning of the year, Bitcoin has surged by more than 40% after moving from a $16,000 low seen late last year to tapping as high as $25,000 earlier this month.
However, the crypto asset’s rally has slowed down, up by less than 2% in February alone compared to its significant rally last month. BTC has only added about $1,500 to its value this month after trading above the $25,000 market for the first time in recent months.
Furthermore, the BTC price chart has shown ambivalent moves in the past few days leaving traders in a bewildered state. Yesterday, the asset rallied by nearly 3%. Meanwhile, today, BTC has indicated a bearish trend, down by 0.2% in the last 24 hours.
Viewing the 1-day time frame, BTC is still above the support of $22,800. Should BTC break the support, the assets could be in for a continuous downtrend to take all the sell-side liquidity till it trades just above the $18,000 region.
Featured image from Unsplash, Chart from TradingView.