Bitcoin’s (BTC) price grows as demand continues to overcome the ever-shrinking supply.
Bitcoin is trading at just under $67,000 at the time of writing, after having gained 9.15% over the last seven days. The updraft that raises Bitcoin’s price comes as the number of coins held on exchanges falls to new lows.
The market forces
CryptoQuant data shows that Bitcoin held on exchanges has just hit an all-time low of under 2.7 million Bitcoin, down from over 3.3 million nearly three years prior. This is the lowest-ever reported value. Still, the data is reported with one month of delay and older data than October 2021 is not available. Those are the conditions of a data-sharing industry arrangement that took form after the fall of crypto exchange FTX.
A lower number of coins available on exchanges translates to a lower immediately available supply — which is usually seen as a bullish sign. Another positive market force to consider is that the trustee overseeing Mt. Gox’s assets announced another delay in the distribution of the Bitcoin to creditors.
Some of the Mt. Gox creditors have already been repaid. Still, data gathered from blockchain analytics platform Arkham Intelligence shows that 44,905 BTC are still awaiting distribution — for a total value of about $3 billion.
Another factor that shrinks supply is Bitcoin staking protocol Babylon’s recent decision to recently re-open deposits. This reportedly resulted in $1.5 billion worth of Bitcoin becoming locked in the system in under one and a half hours.
The Crypto Fear & Greed Index, a multifactorial measure of crypto market sentiment, currently stands at 71, indicating that the crypto market is now overrun by greed. In such cases, the instrument is being interpreted as a warning of a possible imminent correction — but no instrument can guarantee any kind of market performance. The website reads:
“When Investors are getting too greedy, that means the market is due for a correction.”