Typically, such a steep decline in exchange reserves is seen as bullish, signaling reduced selling pressure. But despite strong accumulation trends, Bitcoin’s price remains relatively stable.
Institutional Demand Is Rising
The tweet highlights several powerful tailwinds:
- MicroStrategy just added 15,000 BTC to its holdings.
- Spot Bitcoin ETFs continue stacking BTC.
- Sovereign wealth funds are circling the asset.
With major buyers scooping up supply, many expected prices to surge. Yet the market hasn’t responded with the explosive momentum some anticipated.
What’s Missing?
The image shared by Swan shows a historical comparison between exchange balances and Bitcoin price. It implies that while falling exchange balances often correlate with future rallies, there can be a delay before the price reacts. Market participants may still be digesting recent macroeconomic conditions or anticipating key regulatory and liquidity shifts before the next move.
Alexander Stefanov
Reporter at Coindoo
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over 8 years of experience covering the crypto, blockchain and fintech industries, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics.
Source: https://coindoo.com/bitcoin-supply-on-exchanges-hits-5-year-low-so-why-isnt-price-soaring/