The chances of another major bitcoin selloff are rapidly diminishing as more BTC holders are accumulating and HODLing their bitcoin assets.
A new intelligence report published by the San Francisco-based cryptocurrency exchange, Kraken, revealed that the supply of BTC on crypto exchanges has continued to drop.
According to Kraken, investors are gradually seeing incremental upside and prefer to keep their BTC assets in cold storage for longer periods.
Following the recent major crackdown on bitcoin by the Chinese government, which drove the market lower and pushed bitcoin supply on exchanges to an eight-month high of 2.683 million BTC in June, the BTC supply had fallen by 9.6%.
At current levels, the bitcoin supply has now reached a new three-year low, with about 2.426 million BTC ($139.8B) sitting on crypto exchanges.
Is 100k BTC Still Possible?
Exchange-flow data is an important metric used to monitor bitcoin’s price movement in the short to medium term. An increase in net inflows is often an indication of a major selloff as more investors transfer their BTC from cold wallets to the exchanges.
In contrast, less supply of bitcoin on exchanges suggests bullish trends since it puts upward pressure on BTC prices as new demand enters the market.
In the report, Kraken noted,
“While we’ve acknowledged the probability of a supply shock sending prices higher over the past few months, November’s on-chain data shows that sentiments remain bullish and buy-side demand is outpacing sell-side interest.”
Additionally, investors are finding more reasons to be bullish as the Bitcoin adoption speed continues to increase. Just recently, the Latin American country of El Salvador revealed that it would be building a crypto-powered city and increasing its bitcoin holdings.
Several bitcoin enthusiasts and analysts have predicted that bitcoin is heading toward the $100k mark, despite the volatility plaguing the market.
On Nov. 20, 2020, the popular Bitcoin analyst under the pseudonym, PlanB, boldly stated that he is convinced that bitcoin will hit $100k before December 2021.
