Bybit observed that the volume of bitcoin reserves on centralized exchanges is falling dramatically. Based on the existing 2 million Bitcoins and approximate $500 million inflow into Bitcoin Spot ETFs per day, around 7,142 bitcoins will leave exchange reserves every day.
Based on this metric, exchanges will run out of BTC in nine months. The report also hinted that a decrease in reserves could reflect on prices, pushing it higher.
Pre-Halving Trading Volumes
Some experts suppose that this pre-halving increase of the trading volumes indicates less substantial price decreases after the event confirmed by the earlier halvings in 2012 and 2016.
Nevertheless, the gestalt of this cycle has turned more and more complex, particularly with the recent presence of US crypto Spot ETFs.
Traditionally, one has to enter the market about six months before the coming of halving and hold on to the Bitcoin for at least one year.
Bitcoin’s resurgence started at the October before last (2023), coinciding with a six month time period to be ended by the impending April 2024 halving.
However, this operation is running in sync with Traditional financial institutions applying to operate Bitcoin Exchange-Traded Funds (ETFs).
Nonetheless, the agreement on this case is still absent for the question “whether, in this cycle, the pre-halving effect was more pronounced than in the previous cycles”.
Bybit Suggests Shift in Investor Positions
An asset allocation report stated there was a significant increase in investors’ position on the asset in January 31, 2024, compared to those of the same period in September of the preceding year.
Moreover, institutional investors held an average of 40% of their portfolios in Bitcoin whereas retail investors held an average 24% during the same period.
As Bitcoin secures its place not only as the first cryptocurrency but also the first currency with SEC-approved Spot ETFs, it turns to a preferred investment possibility even for the most cautious investors in the crypto market.
A high price correlation between Bitcoin and other cryptocurrencies combined with its reputation as the cryptocurrency with the minimum volatility, is an indicator of its attractiveness.
