The volumes ofThe exchange of cryptocurrencies is declining as investors continue to withdraw their BTCs. This trend started in January when several exchanges saw a significant outflow of bitcoins.
Bitcoin’s balance on cryptocurrency exchanges fell nearly 10%
According to the research company Glassnode, the number of bitcoins on the stock exchange has dropped by almost 10% in the last three months. The analysis within the network shows that until April 12, 2190887 Bitcoin coins were stored on the exchange platforms. Since mid-January, when the annual maximum of 2412236 coins was registered, the decrease has been 221349 coins. This is 9.17% of the bitcoins that have been listed for a period of 3 months.
Investors are withdrawing #Bitcoin of exchanges – possibly an indication of a shift to longer-term holding strategies.$ BTC The balances fell by almost 10% compared to the highs in January. http: //t.co/mMVqCQmkax pic.twitter.com/wccnWnM4ka
– glass knot (@glassnode) April 14, 2020
Such a significant decline is worrying as crypto asset trading activity has increased in recent years as the number of investors opting to enter the world of digital currencies increases. However, bitcoin trading has slowed significantly in recent weeks due to the increased volatility and uncertainty following the Covid19 outbreak.
The cryptocurrency markets did not fully recover after the March 12 collapse, in which Bitcoin lost more than 50% in 24 hours. As a result, these data suggest that investors may have been affected by uncertainties in the crypto market.
Crypto investors seem to prefer long-term strategies
By posting this data on Twitter, Glassnode suggested that investors who scan their cryptocurrencies on the exchanges prefer long-term strategies. Hodl seems to be the new trend. Glassnode has presented a diagram showing the balance of bitcoins on the exchanges. This has dropped significantly and could indicate that many traders are thinking of saving their BTC in the long term. It turns out that the balance increases with the price, while the withdrawal of cryptocurrencies is accompanied by a decrease.
The correlation between the value of Bitcoin and the equilibrium on the exchanges is quite strong, especially within the downtrend, suggesting that investors are following the market momentum. Therefore, traders continue to withdraw their Bitcoin en masse after the price drop on March 12. This trend continues despite the slight price recovery. And investors are still not sure where the market will go.
Therefore, they prefer to withdraw the cryptocurrencies and keep them in a safer place until they are ready to return to the market. This also shows that investors prefer long-term strategies. The ongoing decline in bitcoin on exchange platforms confirms these assumptions given the current market conditions.
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