Bitcoin Supply on Exchanges Falls to 7-Year Low. Price Surge Incoming?

Santiment’s analytical data reveals a significant milestone in bitcoin’s trajectory. The ratio of supply held on exchanges has plummeted to a mere 7.53%, marking the lowest level since February 20, 2018.

This seven-year low shows that investors still prefer to hold onto their bitcoin for long, even when the price goes up and down quickly. This means more people are choosing to keep their BTC themselves, which lowers the amount available to buy and sell right away.

What Does this Mean For BTC?

A smaller amount of BTC on exchanges often signals a bullish sentiment among market participants. This is because there is less pressure to sell quickly and holders feel more confident. 

Recently, institutional involvement has largely contributed to bitcoin’s price changes. Since March 14th, money has been consistently flowing into spot BTC ETFs, causing the asset’s value to jump by over 10%.

On the other hand, when ETF inflows were negative or flat between February 10th and March 13th, bitcoin’s price dropped by 17%. This clearly shows that when big investors buy BTC, the price goes up, and these large investors have more influence on the market than smaller, individual traders.

Will Bitcoin’s Price Surge?

Recently, bitcoin ETFs in the United States saw their biggest outflow in one day, as the asset’s price fell below $90,000. This change in the market has made investors worried. CoinGlass data shows that the 11 funds had a total outflow of $937.9 million, their sixth losing day in a row.

However, Arthur Hayes, a Co-founder of BitMEX, predicts on the 24th of March that bitcoin could hit $110,000 soon. But, he also noted it might drop to about $76,500.

Hayes’ positive outlook is because he thinks the Federal Reserve will start to loosen its grip on money instead of tightening it. He believes this shift will help bitcoin’s price. He also highlighted the current tariff wars around the world are just “temporary inflation” and will not stop bitcoin from going up.

Also, the decrease in exchange supply suggests more interest from big investors and long-term storage options. Moving bitcoin into personal storage or safe institutional storage highlights that many people now see bitcoin as a way to store value, not just something to trade for quick profit.