The amount of Bitcoin held on centralized exchanges has dropped to a six-year low as its price reached a new all-time high.
On Sunday morning, Bitcoin reached a new peak of just over $125,700 on Coinbase, as reported by Tradingview.
Its previous high was $124,500 on Coinbase on August 14. Bitcoin (BTC) retraced by 13.5% by September 1, but has made a strong recovery in the past week as ‘Uptober’ commenced.
“Bitcoin hits a new all-time high … Yet many people still haven’t grasped what Bitcoin is,” noted Nova Dius President Nate Geraci.
“If Bitcoin convincingly exceeds $126,500, it’s likely the price will rise significantly and rapidly,” stated analyst Rekt Capital on Saturday, prior to the latest price surge.
Exchange balances hit six-year low
The total Bitcoin balance on centralized exchanges has fallen to a six-year low of 2.83 million BTC as of Saturday, according to Glassnode.
The last time there were fewer coins on exchanges was early June 2019, when the asset traded around $8,000 during a bear market.
Blockchain analytics platform CryptoQuant reports a slightly lower total exchange reserve of 2.45 million BTC, marking a seven-year low.
Both platforms indicate that the BTC exchange balance has sharply declined over the past couple of weeks. More than 114,000 BTC, worth over $14 billion, has exited exchanges in the last fortnight, according to Glassnode.
When Bitcoin is transferred off centralized exchanges to self-custody, institutional funds, or digital asset treasuries, it suggests that holders plan to retain their coins long-term rather than liquidate them. Bitcoin held on exchanges is viewed as “available supply” that could potentially enter the market at any moment.
Exchanges running low
“Reports are indicating that exchanges are running out of Bitcoin,” reported Matthew Sigel, head of digital assets research at VanEck, on Saturday.
“Monday at 9:30 am could mark the first official shortage,” he added, “This is not financial advice… just: it may be wise to acquire some.”
Investor and trader Mike Alfred mentioned on Sunday morning that “I just got off a 20-minute discussion with the individual who manages the most significant OTC desk.”
“According to him, at the current rate, they will run out of Bitcoin to sell within two hours of futures trading starting tomorrow, unless prices reach between $126,000 and $129,000. Things are getting intense.”
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