Bitcoin [BTC] prices have begun to fluctuate after rallying for the previous three months. However, the decline in exchange deposits indicated that holders remained optimistic about the future of the king coins.
Bulls and Bears “exchange” glances
According to data from Glassnode’s, the number of exchange deposits hit a two-year low at the time of writing.
📉 #Bitcoin $BTC Number of Exchange Deposits (7d MA) just reached a 2-year low of 2,239.333
Previous 2-year low of 2,243.845 was observed on 29 December 2022
View metric:https://t.co/v3uKq4ea9v pic.twitter.com/yNIYfMkB3m
— glassnode alerts (@glassnodealerts) April 24, 2023
This decline in exchange deposits could be taken as an indication of reduced selling pressure, which may indicate that fewer individuals were keen on liquidating or trading their Bitcoin holdings.
As a result, there could be a possible contraction in the supply of Bitcoin available for sale, potentially driving up the price of the cryptocurrency if demand remains robust or experiences a surge.
Whales were also observed to be showing interest in BTC over the last few weeks. During the weekend, there was a continuous accumulation of Bitcoin by the whales, with each whale’s supply exceeding 530 BTC for the first time since the FTX collapse.
Whale accumulation may indicate a bullish sentiment and potentially drive up prices in the short term. However, a high concentration of whale holders could make retail investors vulnerable to sudden whale behavior in the long run.
Despite the high whale interest, the prices were yet to budge in a positive direction. One of the reasons for the BTC’s price decline would be the behavior of short-term BTC holders. These short-term holders bought the local top where BTC’s prices were more than $30,000 and sold at a loss.
It is yet to be determined whether long-term holders would engage in similar behavior as prices of BTC start to surge.
At press time, the weighted sentiment toward BTC started to decline. Coupled with that, the active addresses on the BTC network also witnessed a fall. This decline in activity on the BTC network may act as a hurdle in BTC’s growth in the future.