With the price over $ 40,000, bitcoins keep coming out of the exchanges

The amount of bitcoins (BTC) deposited in exchanges has been decreasing since March 2020. In these 11 months, more than 600,000 BTC were withdrawn and not even the recent price increase caused them to re-enter massively to exchange platforms.

The hodlers, as those who hold BTC in the long term are often called, they look like determined to keep your money in this cryptocurrency without exchanging your investment for fiat money, such as the dollar or the euro, at least in the near future.

In this regard, trader and market analyst Willy Woo shared on his Twitter account a chart provided by blockchain analytics company Glassnode. There you can see the flow of BTC moving towards directions that are historically hodlers strong (in red).

The analyst commented that, normally, what is seen before a strong rally Bullish is a green zone (that is, bitcoins in the hands of active traders). This occurred notoriously in 2017, but was hardly seen in 2020. For Woo, this is an indicator that the present rally bullish would only be in an initial stage.

The latest purchases have been driven by participants who are long-term hodlers. This is bullish. This rally is far from over. This is the change in bitcoin: the offer moves between the participants. The more currencies that move from the liquid zone (active traders) to the illiquid zone (hodlers), the bullish.

Willy Woo, trader and market analyst.

ViewBase analytics company details that on January 1, 2021 there were only 1.51 million BTC in exchanges. This implies a 36% reduction from February 2020 when the number was 2.37 million BTC. The current working capital of bitcoin is around 18 million, which means that 8% are still in exchanges.

The markets analyzed are, in decreasing order of stored bitcoins, Coinbase, Huobi, Binance, Kraken, OKEX, Bitfinex, Bittrex, Coincheck, Gate.io, Bitstamp, Poloniex and BTC.top. In the last 30 days, more than 87 thousand bitcoins left in total from those platforms; 80 thousand came from Coinbase alone, which represents almost 10% of the total BTC that this exchange has.

Bitcoin as a long-term investment

It can be inferred from this that there are more and more operators, who may be individuals or institutional investors, who withdraw bitcoins from exchanges to hold positions in the long term. If so, it is a scenario in which demand exceeds supply (there are more buyers than sellers), which drives up the price of the asset.

Already in October 2020 CriptoNoticias reported how the holding outside the exchanges would be driving up the price of bitcoin. In addition to individual investors, they joined in the last year publicly listed companies, private companies and investment funds, who contract bitcoin custody services. These they work apart from the exchanges and they keep crypto assets in cold wallets.

The data provided here and the crypto asset price advance support Woo’s predictive model. The analyst predicts that bitcoin will be at $ 200,000 by the end of 2021 and clarifies that, by saying that, he is being “conservative.”