The liquidity crisis on the sales side comes as Bitcoin reserves on the exchanges near record lows

The latest data shows that the number of bitcoins available on exchanges is on the verge of hitting an all-time low.

As Ki Young Ju, CEO of the on-chain analysis platform CryptoQuant, noted, the reserves on the stock exchange are back at an all-time low, which was last recorded in early May.

$ BTC The supply on the stock exchanges is about to break its previous low.

I hope for another liquidity crisis on the seller side #Bitcoin.

Live chartshttps://t.co/blydpKpykt pic.twitter.com/zCrq9o5YFT

– Ki Young Ju (@ki_young_ju) September 10, 2021

It’s time for “seller liquidity crisis” is different?

On Thursday, the last day the numbers were updated, 2,399 million BTC was available on major exchanges. The May low was measured at 2.390 million.

As a result, Bitcoin traders reversed the trend of sending funds to exchanges that occurred during the price movement in mid-May, showing a clear return of investing rather than speculation sentiment.

“Expect another liquidity squeeze on the seller side for Bitcoin,” added Ki in the comments.

Bitcoin reserve on the bottom (green) and price BTC / USD (Black) | The source: KryptoQuant

One such crisis, also known as “supply compression,” has shaped the dominant narrative in recent weeks, underpinned by healthy buying of excess liquidity after Tuesday’s decline.

Not only retail but also derivatives platforms have pulled large amounts of BTC off the exchanges this week, while the overall BTC offering becomes less mobile.

Data from on-chain analytics firm Glassnode confirmed that the portion of supply that last moved a year or two ago hit a three-year low on Friday.

As a result, people who last moved BTC to an address between September 2019 and September 2020 have not touched their coins.

Last active BTC delivery 1-2 years ago | The source: Glass knot

Whale promotes Bitcoin on futures exchanges

CryptoQuant also provides data shows The major Bitcoin addresses send funds to derivatives exchanges. The company’s CEO suggested that the reason could be to fill the margin or start new positions.

“Whales are sending BTC from another exchange to a derivatives exchange to create new positions or fill margins. Looking at historical data, the price increases in the long term after accumulation. Your position seems to be long. “

An increase in bitcoin inflows from large wallets can become a worrying signal for market participants as it turns into a sell-off signal in most cases as funds move from the cash market to the exchange derivatives. Traders usually keep coins on the exchange when they want to sell them.

However, Ki argued differently: some holders could start taking new long positions or funding previous positions that are close to liquidation if Bitcoin drops to $ 46,000. He also added that most of the time when these wallets transfer money to the exchange, they accumulate large amounts of Bitcoin, causing explosive price spikes.

The source: KryptoQuant

Previously, in October 2020, just before the last major bull run began, which saw Bitcoin jump from $ 10,000 to nearly $ 65,000, there were increased inflows into derivatives. The reason for such a strong upward movement are heavily leveraged positions. To ensure a sharp spike in market volatility, most positions are funded through derivatives exchanges, which offer traders a high margin.

The market will most likely not see an immediate effect as the volume has moved too much to be instantaneous. At the time of writing, Bitcoin is priced at $ 45,579 after falling from $ 52,500 to $ 43,000 in one day.

Bitcoin’s next support

BTC continues to trade below $ 46,000 at press time.

Still in Video The youngest YouTuber Michaël van de Poppe denies any evidence that Bitcoin has entered a bear market, with nearby levels offering support.

If $ 45,700 can’t hold, the next zone would be $ 43,000 to $ 44,000.

Source: Michael van de Poppe

“On the other hand, $ 46,700 remains a very important resistor. If it breaks I think the chances of the price rising above $ 47,500 en route towards $ 50,000 are pretty high and that will give strength to the altcoin market if it follows suit ” said the analyst.

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Minh Anh

According to AZCoin News

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