According to Coinglass data, the bitcoin reserves of centralized exchanges have reached a historical low. Does this imply that bitcoin will further rise? This article will analyze the historical trend changes.
Under the dual promotion of the Federal Reserve’s interest rate cuts and relaxed monetary policies, as well as the traditionally excellent performance of the risk market in October, bitcoin broke through the 68,000 level earlier this week, reaching a high of $68,422, a new high since July 30th, showing promising performance.
The current concern of investors is whether the upward trend of bitcoin will continue. After all, it has risen by more than 15% in the past week.
Regarding this, Cointelegraph posted a picture on social platform X yesterday, pointing out that the bitcoin reserves on centralized exchanges are currently about 2.43 million coins, once again hitting a historical low. The continuous decline in bitcoin reserves on exchanges may indicate that investors are more inclined to transfer bitcoin to cold wallets, thereby restricting market supply and possibly indicating a rise in bitcoin prices.
However, as time goes on, let’s verify whether “bitcoin reserves on exchanges” can really serve as an indicator for judging the trend of bitcoin.
According to Coinglass data, after the price of bitcoin reached a historical high of $73,000 in March this year, the bitcoin reserves have been declining, but the BTC price has not set a new high but has continued to oscillate.
Therefore, in the short term, this indicator does not seem to be completely consistent with the trend of bitcoin. The author believes that when the liquidity of bitcoin was not as good in the past, this indicator may have sufficient reference value. However, with the development of the market, coupled with the emergence of bitcoin OTC market, futures, and spot ETFs, the reference value of this indicator may be weakening, or at least the relevance has decreased. Therefore, investors are urged to evaluate from multiple perspectives.
Analyst: Bitcoin will break through $70,000 in the next few weeks
Regarding the future trend of bitcoin, Jonathan de Wet, the investment director of Zerocap, expressed optimism in a research report on Wednesday (16). He believes that the upward trend of bitcoin is still strong and is expected to break through the $70,000 mark in the next few weeks:
The technical breakthrough provides a solid foundation for further rise in bitcoin. We expect bitcoin to reach $70,000 in the next few weeks.
As for the factors driving the rise of bitcoin, blockchain expert Anndy Lian summarized that the upcoming US presidential election, with Trump currently leading over Biden, brings hope for a favorable regulatory outlook in the cryptocurrency field. On the other hand, major economies including the United States, Europe, and China are implementing loose monetary policies, and risk markets including bitcoin will attract capital inflows.
