Bitcoin supply across all exchange wallets remains at a 2-year low as outflow increases as price begins to climb again.
In data from Blockchain analysis firm, CryptoQuant, Bitcoin held across all exchanges sat at 2.3 million as of March 8. This followed an outflow of 61.8 thousand BTC across all exchanges on the same day. This was an increase in outflow of over 30 thousand BTC from the previous day.
Coinbase Pro, a popular exchange with institutional investors, alone saw an outflow of 15,700 BTC at a value of $850 million on Monday as well.
This decline maintains the 2.5 year low recorded at the beginning of February.
This supply dry-up is the longest ever seen, according to Blockchain analysis firm Glassnode.
In their newsletter, Glassnode co-founders Yann Allemann and Jan Happel explain that this could lead to a massive supply squeeze.
Long-term BTC Holders Undeterred
As the BTC price continues to rally, punctuated by dips, long-term holders are not selling off as they have in the past, according to an analysis by Galssnode. Alleman and Happel explain that this is likely because they don’t see the current price as the top.
This is in line with other analysts who speculate that the Bitcoin price could go as high as $100,000 in 2022, off the back of the latest halving and growing institutional interest.
These institutions also appear to be in it for the long haul. Firms investing in Bitcoin are looking at their buys as investments rather than trade or profit mechanisms. This is because many are using Bitcoin as a hedge against inflation of the US Dollar.
Bitcoin enthusiasts like MicroStrategy Michael Saylor have been making big buys even as the price takes a turn. Most recently, he bought another $10 million worth, while the price was below $50,000.
The increase in these Bitcoin whales– a term for those holding 1,000 BTC or more – has been considered a significant contributor to the supply crunch. More than 200 new addresses passed this threshold in 2021. And the price increase isn’t deterring those with money from buying up even more.