Bitcoin balance on exchanges has reached a four-year low!
As the crypto winter deepens, only the dedicated Bitcoin investors can be seen holding onto their tokens, but not the exchanges. Investors appear to be entering hibernation mode, as indicated by the 13% drop in activity on the chain in early July.
Strikingly, Bitcoin holders are seen transferring their holdings from the crypto exchanges. The report comes from a recently published tweet by Arcane Research. To add to this, Glassnode reported that Bitcoin’s balance on exchanges has reached a four-year low.
Arcane Research explains the situation
Arcane Research has reported negative exchange net flows that it has perceived since the beginning of the year.
The chirping by Arcane Research also mentions a reason. The collapse of major crypto lenders – Celsius, Babel Finance and Vauld, due to liquidity problems earlier this summer, has been a major driving force behind this and has led to large amounts of withdrawals.
According to the tweet, “users have been withdrawing Bitcoin from exchanges ‘like never before.’
Arcane Research also added that the problems with lenders have done some serious harm to users. They also assumed that users could lose interest in crypto exchanges.
Arcane Research wrote, “These events undoubtedly damaged the credibility of lenders, but are HODLers also losing confidence in the exchanges?”
In June, 119,000 BTC were moved from exchanges, and after this, in July, 96,000 Bitcoin were withdrawn. Later, in August, 65,000 BTC have been withdrawn so far.
Before the summer, the largest amount of BTC taken away from the exchanges was 71,000 coins in total.
According to GlassnodeBitcoin’s balance on centralized crypto exchanges has fallen to a four-year low of 2,342,202,837.
Activity on the chain falls in the middle of crypto winter
According to a Glass node analysis, in early July, Bitcoin saw a 13% drop in chain activity from November’s highs – levels last seen in the bear phases of 2018 and 2019 when Bitcoin was worth less than $10,000.
The risk-off market sentiment appears to be spreading to cryptocurrency exchanges as investors retreat to hoard their coins offline in crypto wallets instead. According to Glassnode, the exchanges have now seen their balances fall by more than 20% from a peak on 20 January.
According to a Glassnode newsletter of July 4, “Bitcoin has seen an almost complete exodus of market tourists, leaving HODLers’ determination as the last line.”
