Santiment stated in a new tweet dated November 27 that Bitcoin HODLers were switching to self-custody and withdrawing their BTC from exchanges. Only 6.95% of Bitcoin was on exchanges at the time of the tweet.
As shown in the image below, the supply of Bitcoin on exchanges has dropped to its lowest level in four years. Though the trend of withdrawing BTC from exchanges began in 2020, it has recently accelerated due to the FTX fallout.
Source: Santiment
However, a decline in Bitcoin on exchange did not imply a decreasing interest in BTC.
BTC running on discounted prices
As Bitcoin’s prices fell, many investors decided to capitalize on this opportunity and attempted to secure BTC at discounted prices. As can be seen from the image below, the number of addresses holding more than one coin increased tremendously over the past month and reached an all-time high on 26 November.
But it wasn’t just whales and large addresses that were showing interest in BTC. Retail investors were also making the most of BTC’s price decline, according to data provided by Glassnode. Addresses holding 0.1 Bitcoin reached an all-time high of 4,069,920.
Source: Glassnode
Even though investors had started showing faith in Bitcoin, it still wasn’t enough to improve Bitcoin miners‘ conditions. The mining revenue generated by Bitcoin miners declined significantly over the last few days.
Now, if the miner revenue continues to depreciate along with the price of Bitcoin, miners will be forced to sell their mined BTC so that they can make a profit.
Bitcoin holders make their decision
That said, from the chart below, it can be seen that Bitcoin’s number of daily active addresses had declined. Along with that, Bitcoin’s velocity depreciated significantly. Thus, indicating that the frequency with which Bitcoin was being exchanged amongst wallets had decreased.
Source: Santiment
At the time of writing, BTC was trading at $16,557.39. Its price had decreased by 0.07% in the last 24 hours, according to CoinMarketCap, and its volume slumped by 4.36%.
