Bitcoin Supply on Exchanges Hits Five-Year Low, Fueling Bullish Sentiment

The amount of Bitcoin held on cryptocurrency exchanges has reached a five-year low, signaling potential bullish momentum for the digital asset. According to data from CryptoQuant, which monitors on-chain exchange wallets, the total Bitcoin reserves on trading platforms now stand at approximately 2.6 million BTC. This marks a significant decline from the 3.3 million BTC held on exchanges just two years ago.

This reduction in Bitcoin on exchanges is often interpreted as a positive indicator. With fewer coins available for sale, a steady or rising demand could push prices higher, due to a tightening supply.

The dip in exchange-held Bitcoin comes at a time when miners have similarly reduced their reserves. Currently, Bitcoin miners hold around 1.5 million BTC, the lowest since January 2021. The recent drop follows the April halving event, which slashed the mining reward in half, further straining miner profitability. According to Kaiko data, this reduction has led to increased selling by miners, with many using proceeds to cover operational costs amid market rallies.

However, some publicly traded mining companies are bucking the trend. CleanSpark and Riot Platforms have boosted their Bitcoin reserves by 60% year-to-date, while Marathon Digital Holdings recently made a $100 million investment in the cryptocurrency, reflecting continued confidence in Bitcoin’s long-term potential.

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