- Bitcoin exchange reserves gradually decreased during February.
- The whale population has increased by nearly 4% over the past month.
Approximately 50,000 Bitcoins [BTC] was withdrawn from centralized exchanges throughout February, plummeting the “purchasable” supply of the world's largest cryptocurrency.
Bitcoin exchange reserves gradually declined even as the market price soared 44% in the same month, according to an analysis by AMBCrypto using data from CryptoQuant.
Source: CryptoQuant
Why is this a bullish signal?
Typically, a decrease in exchange supply means a decrease in selling pressure; They may move on to other activities, such as becoming long-term holders.
Additionally, more Bitcoins were accumulated and stored in self-custodial and cold wallets, creating scarcity in the market. According to supply and demand dynamics, this was a huge bullish signal.
The number of Bitcoin whales increases
Another important reflection of widespread hoarding sentiment is the sharp increase in the number of institutional investors, also known as whales, in the crypto market.
The number of unique entities holding at least 1,000 Bitcoins increased by 55 during February. This represents an increase of nearly 4% compared to the previous month.
Source: Glassnode
The launch of multiple exchange-traded funds (ETFs) that track the spot price of Bitcoin opens the door to the crypto market for U.S. TradFi investors.
This game-changing event has led to bullish predictions, with one study predicting Bitcoin will grow to $100,000 by the end of the year and reach nearly $200,000 by the end of 2025.
Whale investors were likely motivated by these optimistic predictions to stockpile Bitcoin.
Where will BTC go?
Last week, Bitcoin rose to $64,000. This raised expectations that a recovery to all-time highs (ATH) was inevitable. Due to profit taking, King Coin has risen to $61.8 thousand as of this writing.
read bitcoin [BTC] Price prediction for 2024-2025
However, the asset still rose about 20% on a weekly basis, according to CoinMarketCap.
According to the latest readings of the Bitcoin Fear and Greed Index, the market was in a state of “extreme greed.” This suggested that there was a significant degree of FOMO among market participants, leading to a rally in the coming days.
Source: Bitcoin Fear and Greed Index
