More than $1bn BTC leaves Coinbase reserves

Blockchain analyst Glassnode has posted metrics showing the reduction of bitcoin (BTC) in Coinbase’s reserves.

According to the statistics, more than $1bn in BTC has moved out of Coinbase into individual non-custodial wallets. This is a bullish sign for digital currencies as it shows more people continue to buy and move their assets off trading platforms.

The $1bn transaction is the largest of its kind since the 2017 bull market. This leaves Coinbase with a reserve of around 650,000 BTC. This is a 36% drop in reserves from its high in April 2020. Coinbase reserves have not been this low since 2017.

When BTC or other digital assets are moved away from trading platforms it indicates they are going to be held for a longer period of time.

Those who trade cryptocurrency frequently do not move their coins off exchanges as it increases the time required to trade. When holders fear the market, they will move their cryptocurrencies on to exchanges to have their assets available to trade.

Glassnode also showed that users who held their cryptocurrency for half a year or longer are the largest accumulators of BTC. Long term holders do not seem fazed by the recent downturn of the market and are instead using this opportunity to buy more.

Glassnode speculates that the recent downturn in the market has scared away a good portion of retail investors and believes institutional investors are the major buyers at the moment.

Institutional investors are more focused on the long-term gains while retail investors have a more short-term mentality.

The amount of BTC being accumulated per month is higher than the amount of BTC being produced through mining. This means the amount of BTC that will be in the circulating supply will continue to decrease.

Should the market shift in a way that attracts retail investors again, the amount of BTC available for them to purchase will be lower causing increased demand.

The short term is harder to understand with all the current events and financial markets but the demand for BTC continues to increase.

 

Looking for your next crypto casino? Check out: Mega Dice or FortuneJack

Written by Tudor

Works as a developer and helps keeps the digital cogs turning. Leave them alone, they're busy.

Similar News