Bitcoin On CEX Hits Lowest Level Since 2018

The amount of Bitcoin (BTC) held on centralized exchanges (CEX) has dropped to its lowest level since 2018, is this a bullish sign?

Users appear to be withdrawing assets from exchanges due to concerns about the contagion following recent issues with Celsius and Babel Finance. The chart below by Glassnode shows the massive drop in Bitcoin across exchanges on June 13 when Celsius announced it would suspend withdrawals.

The amount of BTC on exchanges crossed the 2.4 million mark in 2018 and had never dropped below this mark until this June. It peaked in May 2020 at 3.1 million BTC and has been in a downtrend ever since.

Historically, investors have viewed crypto withdrawals from exchanges as a bullish indicator. As the balance of an asset on exchanges decreases, so does its liquidity and ability to trade. Many people believe that when outflow increases, investors move money to cold wallets for long-term holding.

In light of concerns surrounding certain exchanges, crypto YouTuber Coin Bureau recently asserted:

Celsius investors still could not access their funds for two weeks after withdrawals were halted. Keeping Bitcoin in a wallet gives investors complete autonomy while depositing crypto on an exchange is similar to depositing it in a bank but without the government bailout protections.

Below 2.4 million BTC on exchanges and over 30 million active investors on Binance, the scarcity of the asset is growing. If Bitcoin demand continues to grow while balances on exchanges decrease, it could set up a strong upside move. The market cap is now back at $1 trillion with positive bullish signals from Bitcoin and altcoins.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

Join CoinCu Telegram to keep track of news: https://t.me/coincunews

Follow CoinCu Youtube Channel | Follow CoinCu Facebook page

Harold

CoinCu News