Bitcoin ratio of supply on exchanges hits 6 months low - page 2.

pooya87

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Quote from: Charles-Tim on July 05, 2021, 03:57:02 PM

The price of bitcoin recently had been struggling to climb above $40000

Another way of looking at it is that price has been failing to go any lower than the strong support at $30k. That is despite a lot of dump attempts!

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holders are accumulating already, that is why the supply on exchanges has been diminishing,

There has been a strong accumulation taking place but that is not why the "balance" on exchanges is decreasing. It is simply because people deposit their bitcoins on exchanges to trade with those coins. If the price is not making any moves that could give them profit they will simply stop trading and since exchanges are risky by nature they don't leave their coins there. Withdrawing from exchanges like this decreases their balance (or supply on exchange if you like to call it that).

In fact if you look at the shitcoin market the "balance" there is increasing because the only time shitcoins can get pumped is when bitcoin price is stable, hence traders moving there for profit.

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which means people that will sell Bitcoin will not be many as Bitcoin users are moving bitcoin to wallet. The inflow and outflow of Bitcoin on exchanges has significantly be an indication of where the prices is trending to while exchange inflow indicates holders want to sell which will later result to decrease in Bitcoin price, while Bitcoin exchange outflow in which holders will send their Bitcoin to wallet has been an indication that selling rate will decrease and get below the buying rate, leading to bitcoin price increase.

This part makes no sense to me because you don't buy bitcoin from the exchange or sell it to the exchange. The exchange is just a platform where users meet to trade with each other which means if you buy 1 bitcoin someone has to have sold 1 bitcoin (zero sum game).

adaseb

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There is a lot of reasons why the supply decreases. Sure there are companies like Tesla which buy billions and which are going to be held in cold storage. But there are other reasons.

Like what was mentioned above. Some retail newbie might lose their BTC due to whales and the whales withdraw those profits into cold storage.

Another reason is people have hardware wallets these days and are worried about security on exchanges and withdraw them. Especially since price hit $64K at one point. So if you had 1 BTC and before it was worth $10000 you might of not cared as much as it’s worth $34K now and decide to buy a $100 hardware wallet to protect yourself.

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Quote from: Welsh on July 09, 2021, 10:59:28 AM

I'd have to question the data that's backing this up before actually commenting on it. For example, what exchanges are included, is the new decline an indication or either new exchanges taking some of the volume or are more people looking to use peer to peer exchanges, which probably aren't going to be included in a metric like this?

There's too many factors to consider, to be able to accurately determine what direction the price will go.

It is also worth to add that now futures volume is dozen times bigger than spot exchange volume. It was not like that before 2018.

Its like 10x bigger volume. So i dont believe in "miners are not selling" or "1k+ BTC whales are not selling" only because they are not moving coins. It is possible that big farms already hedged whole 2021-2022 supply that they plan to mine in this year's with big short position at 60k. We don't know that. Same with whales. With 10 times bigger volume on futures and 1-10k BTC to dump i would rather open big short position using futures without moving price and than move my coins and close hedge.

nelson4lov

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Just like @stompix said, there's no way of accurately track the validity of the data being provided by the guys at Sanbase. For all we know, these could be exchanges moving funds from their hot wallets to cold wallets and might have nothing to do with people moving their funds into their personal wallets. Even if it is, it's neither a bullish or bearish sign only that more people are holding long term and switched off short term selling windows. In spite of the tug of war between Bitcoin Bulls vs Bears, the 6 months TF candle on Bitcoin closed as a shooting star which is a bearish candlestick.

stompix

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They are simply looking at known addresses and cold wallets, and they create those stats based on the inflow and outflow.
I've always taken those with a lot of grains of salt because I remember how hard it was for all those analytics companies to finally track the gox coins or how hard is for them to label those coins Coinbase pro has, there are 1 million of them yet nobody has tagged them where they are. There are so many exchanges popping up, a lot of them change their hot wallets, a lot of them deal with OTC customers, it's pretty hard to look at that graph and say for certain, that's how it is.!

What about the "coins" people have on Paypal or Revolut, for example, how are those classified and where would they stand in a statistic?

Anyhow...
https://www.coindesk.com/bitcoin-balances-2-year-low-bullish-sign
The last time it worked, let's see if it will happen again..
The offer might be low, but is the demand there?

Welsh

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I'd have to question the data that's backing this up before actually commenting on it. For example, what exchanges are included, is the new decline an indication or either new exchanges taking some of the volume or are more people looking to use peer to peer exchanges, which probably aren't going to be included in a metric like this?

There's too many factors to consider, to be able to accurately determine what direction the price will go.

Fundamentals Of

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I would interpret this in a positive yet logical way. If the supply is dwindling, it logically means the sell pressure is also decreasing. Nobody send out their Bitcoin to buy more Bitcoin. It is not the way it works. Bitcoin is deposited where it could be sold precisely in order to sell it. Now if the supply being sold is going down and supposing the demand is not going down with it, the price will definitely rise. I am seeing this figure as a sort of a cue that there is indeed some nice green candles in the days or weeks to come.

DapanasFruit

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We are all hoping that this situation can mean that soon the price of Bitcoin can go up...and maybe can start a new bull run season when we can see BTC achieving a new ATH. of course, for now that can just be wishful thinking but who knows...if there is one thing that is really full of surprises it must be our beloved Bitcoin. There is a possibility that this diminishing supply in exchanges can mean that more and more buyers are taking their Bitcoin into their privately-controlled wallet and this accumulation stage can be over soon resulting into upsurge movement of Bitcoin. Will it happen that way? i can only guess but I am hoping that it will.

GreatArkansas

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Also heads up for some people who are thinking about
Low supply of Bitcoin on exchanges = Price of Bitcoin will pump.

At first, before I am thinking that it will always pump the price of Bitcoin if the supply of Bitcoin to every exchange continue dropping.
But what I can say is NOT ALL OF THE TIME. Some people thinking that "Supply on exchanges dropping, it means no one wants to sell Bitcoin".

DooMAD

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I have a theory as to how that might make sense. Trading is a zero-sum game. For every winner, there is a loser. Over time, the sensible traders gradually gain BTC from the reckless traders. And it's the sensible traders who are more likely to withdraw their surplus funds to a place where they hold the private keys.

pixie85

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Low supply can mean greater volatility. It doesn't have to be volatility to the up side, at least short term.

In the long run though it should mean higher price because sooner or later someone will want to buy a lot of coins and we all know that most orders are packed near the current price. When you break 20% above or below it you enter either a crazy rally up or a free fall down. Decreasing supply means decreasing sell pressure, so if nothing changes in the next 6 months we could see a winter rally to 100 thousand.

Charles-Tim

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The price of bitcoin recently had been struggling to climb above $40000 while resistance recently has been around $36000 recently, but what I read today was amazing but yet not known if this will effectively result to bull market, but this is just an indication of bull market as bitcoin holders are accumulating already, that is why the supply on exchanges has been diminishing, which means people that will sell Bitcoin will not be many as Bitcoin users are moving bitcoin to wallet. The inflow and outflow of Bitcoin on exchanges has significantly be an indication of where the prices is trending to while exchange inflow indicates holders want to sell which will later result to decrease in Bitcoin price, while Bitcoin exchange outflow in which holders will send their Bitcoin to wallet has been an indication that selling rate will decrease and get below the buying rate, leading to bitcoin price increase.

Quote from: https://cointelegraph.com/news/bitcoin-exchange-supply-hits-a-6-month-low-as-accumulation-continues

Exchange inflows began to spike in early May, which likely served as a precursor to Bitcoin’s steep selloff through the middle of the month. The Bitcoin selloff intensified on May 19, culminating in a $1.2 trillion decline for the entire cryptocurrency market.

Exchange-flow data is an important metric for monitoring Bitcoin’s price trajectory in the short to medium terms. Net inflows often foretell a steep selloff as more investors transfer their holdings from cold wallets, possibly for the purpose of selling. Case in point: In May, Bitcoin experienced the biggest exchange inflows since the March 2020 COVID-19-related crash.

https://twitter.com/santimentfeed/status/1411971284448202755

It is clear that bitcoin holders are now accumulating which will make bitcoin price not to plummet, but the question is, will bitcoin price increase as people are expecting? Although, I believe even if the price of bitcoin will not increase so much, the price is also neither will decrease for now as the exchange total supply supply hits its six months low.

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