Bitcoin’s Exchange Reserves Plunge—Are We On The Brink Of A Rebound?
Bitcoin is experiencing a challenging period, with its price remaining below the $100,000 mark after a significant drop earlier this week. Today, Bitcoin hovers just above $98,000, marking a nearly 10% decline from its all-time high of over $109,000 recorded last month. Interestingly, while BTC’s price has slowed, its exchange reserve has faced the same fate, with data showing a continuous decline from this metric. Does This Suggest An Incoming Rebound For Bitcoin? ShayanBTC, one contributor to the CryptoQuant QuickTae platform, particularly pointed out this trend in a post titled “Bitcoin Exchange Reserves Plunge: Is Supply Shock Driving the Next Rally.” According to Shayan, there is a chance that this reserve plunge will become favorable for BTC in the near term. In the post, Shayan disclosed that exchange reserves—the amount of Bitcoin held on trading platforms—have steadily decreased. This trend often signals an accumulation phase by investors, as more market participants withdraw their BTC from exchanges to secure long-term holdings. This reduced circulating supply can create a “supply shock,” potentially driving higher prices in the coming weeks. “As shown in the chart, Bitcoin’s exchange reserves have been on an aggressive decline, signaling an accumulation phase by investors,” Shayan explained. The analyst added: Given that exchange reserves serve as a supply-side indicator, this persistent decline could contribute to further price appreciation in the coming weeks. Bitcoin reserves on all exchanges. | Source: CryptoQuant Bitcoin Exchange Reserves Plunge “As shown in the chart, Bitcoin’s exchange reserves have been on an aggressive decline, signaling an accumulation phase by investors.” – By @ShayanBTC7 Full post 👇https://t.co/xxyCDSg3Vw pic.twitter.com/ntVY7AuDpD — CryptoQuant.com (@cryptoquant_com) February 6, 2025 Coinbase Premium Reaches 0 Zone Besides the exchange reserves, another important metric worth looking at to get the full picture of BTC’s likely trajectory in the near term is the Coinbase premium index. This index measures the price difference between Bitcoin on Coinbase, often a go-to platform for institutional investors, and other exchanges. A positive premium can indicate strong buying pressure on Coinbase, signaling institutional demand. The latest data shows that in recent days, the Coinbase Premium Index broke through the critical “0” resistance level with substantial volume, an occurrence that traders closely monitor. Coinbase premium index. | Source: CryptoQuantTraderOasis, another CryptoQuant analyst, highlighted that this breakout area also functions as a support/resistance level, making it a crucial point of interest. A sustained positive premium might indicate continued institutional accumulation, which could boost Bitcoin’s price recovery. Conversely, a failure to hold this level could suggest lingering bearish sentiment or a potential for further declines. BTC price is moving sideways on the 2-hour chart. Source: BTC/USDT on TradingView.comFeatured image created with DALL-E, Chart from TradingView Samuel Edyme Meet Samuel Edyme, Nickname - HIM-buktu. A web3 content writer, journalist, and aspiring trader, Edyme is as versatile as they come. With a knack for words and a nose for trends, he has penned pieces for numerous industry player, including AMBCrypto, Blockchain.News, and Blockchain Reporter, among others. Edyme’s foray into the crypto universe is nothing short of cinematic. His journey began not with a triumphant investment, but with a scam. Yes, a Ponzi scheme that used crypto as payment roped him in. Rather than retreating, he emerged wiser and more determined, channeling his experience into over three years of insightful market analysis. Before becoming the voice of reason in the crypto space, Edyme was the quintessential crypto degen. He aped into anything that promised a quick buck, anything ape-able, learning the ropes the hard way. These hands-on experience through major market events—like the Terra Luna crash, the wave of bankruptcies in crypto firms, the notorious FTX collapse, and even CZ’s arrest—has honed his keen sense of market dynamics. When he isn’t crafting engaging crypto content, you’ll find Edyme backtesting charts, studying both forex and synthetic indices. His dedication to mastering the art of trading is as relentless as his pursuit of the next big story. Away from his screens, he can be found in the gym, airpods in, working out and listening to his favorite artist, NF. Or maybe he’s catching some Z’s or scrolling through Elon Musk’s very own X platform—(oops, another screen activity, my bad…) Well, being an introvert, Edyme thrives in the digital realm, preferring online interaction over offline encounters—(don’t judge, that’s just how he is built). His determination is quite unwavering to be honest, and he embodies the philosophy of continuous improvement, or “kaizen,” striving to be 1% better every day. His mantras, “God knows best” and “Everything is still on track,” reflect his resilient outlook and how he lives his life. In a nutshell, Samuel Edyme was born efficient, driven by ambition, and perhaps a touch fierce. He’s neither artistic nor unrealistic, and certainly not chauvinistic. Think of him as Bruce Willis in a train wreck—unflappable. Edyme is like trading in your car for a jet—bold. He’s the guy who’d ask his boss for a pay cut just to prove a point—(uhhh…). He is like watching your kid take his first steps. Imagine Bill Gates struggling with rent—okay, maybe that’s a stretch, but you get the idea, yeah. Unbelievable? Yes. Inconceivable? Perhaps. Edyme sees himself as a fairly reasonable guy, albeit a bit stubborn. Normal to you is not to him. He is not the one to take the easy road, and why would he? That’s just not the way he roll. He has these favorite lyrics from NF’s “Clouds” that resonate deeply with him: “What you think's probably unfeasible, I've done already a hundredfold.” PS—Edyme is HIM. HIM-buktu. Him-mulation. Him-Kardashian. Himon and Pumba. He even had his DNA tested, and guess what? He’s 100% Him-alayan. Screw it, he ate the opp. Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. 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