Bitcoin (BTC) is being bought aggressively now that the price has approached $30,000: longer-term investors are absorbing liquidity from short-term sellers.
Data from on-chain monitoring asset CryptoQuant shows that, in late December, BTC reserves on exchanges began to decline again.
Bitcoin is attractive to investors at current levels
After a period of traders sending BTC to exchanges, possibly to sell or limit losses, trading platforms are now seeing more outflows than inflows.
Between December 7 and December 28, 2021, the BTC reserves of the 21 major platforms monitored by CryptoQuant increased from 2.396 million to 2.428 million BTC. We then witness a resumption of the downward trend: this week the number of BTC on the stock exchange amounts to 2.428 million. This despite the fact that the value of the cryptocurrency has decreased.
The possibility that older whales could initiate a price reversal should not be ruled out, commented Ki Young Ju, CEO of CryptoQuant.
“It looks like $BTC has been sold to new players up and down,“declared in a series of tweets on the subject, noting that institutions are likely the top buyers since 2020.
The whales buy the dip
The downward trend in balance sheets on exchanges coincides with strong on-chain demand from major investors.
As highlighted this week by the CC15Capital Twitter account, the drop to $33,000 was accompanied by multi-million dollar buy-ins from one portfolio in particular. Since August, this address has accumulated a BTC value of over $1 billion, starting with a starting balance of zero.
— CC15Capital (@Capital15C) January 25, 2022
Also, long-term holders still don’t want to sell. As Cointelegraph reported, coins that haven’t moved for a year or more now make up 60% of the overall BTC supply.