Bitcoin and Ether Stash on Exchanges Shrinks to Historic Lows
Crypto News- On Monday, there was a significant drop in the percentage of Bitcoin (BTC) and Ether (ETH) held on exchanges, marking multi-year lows.
Currently, only a little over 11.5% of BTC’s total supply resides in exchange wallets, which is approximately an 8% decline since the beginning of the year. This shift occurred notably after the U.S. Securities and Exchange Commission gave the green light to several spot Bitcoin ETFs. As for ETH, exchanges now hold around 10.6% of its total supply, indicating a decline of approximately 10.6% in 2024. This trend coincides with preparations within both the cryptocurrency and traditional finance realms for the imminent launch of several spot Ether ETFs.
Exchange-Held Supply at Historical Lows: Bitcoin and Ethereum Trends
Interestingly, these drops mirror historical lows in exchange-held supply percentages. The last time BTC held on exchanges reached a comparable low was in December 2017, while for ETH, it was in October 2015, coinciding with Ethereum’s first-ever transaction.
A decrease in BTC and ETH held on exchanges typically suggests a shift towards a longer-term investment strategy, as tokens held outside of exchanges are less readily available for immediate selling. Currently, exchanges collectively hold over 2.28 million BTC, valued at approximately $154 billion, and nearly 12.66 million ETH, amounting to around $48 billion.
Kraken’s Record Outflows: BTC and ETH Trends
This decline in exchange-held supply aligns with recent observations from Kraken, a centralized exchange, which recorded its largest outflows of BTC and ETH in roughly seven years on May 29. The daily outflow surpassed $4.45 billion at current market prices, marking the largest outflows since 2017 for both cryptocurrencies, according to data from on-chain analytics firm CryptoQuant.
Despite these significant outflows, Kraken maintains an on-chain portfolio valued at $20.5 billion as of the time of writing, according to insights from crypto research company Arkham Intelligence.
FAQ
Why did the percentage of Bitcoin (BTC) and Ether (ETH) held on exchanges drop significantly on Monday?
The drop in the percentage of BTC and ETH held on exchanges can be attributed to a shift towards longer-term investment strategies by investors. This trend coincided with the approval of several spot Bitcoin ETFs by the U.S. Securities and Exchange Commission and anticipation surrounding the launch of spot Ether ETFs, prompting investors to move their assets off exchanges and into direct custody.
How significant is the decline in exchange-held supply percentages compared to historical lows?
The recent drop in exchange-held supply percentages for BTC and ETH marks multi-year lows. The last time BTC held on exchanges reached a comparable low was in December 2017, while for ETH, it was in October 2015, coinciding with Ethereum’s first-ever transaction.
For the latest in crypto updates, keep tabs on Crypto Data Space.
Leave a comment