Bitcoin Eyes New Highs as $7 Billion Exodus Drains Exchanges
cryptoglobe.com 19 July 2024 19:42, UTC The price of the flagship cryptocurrency Bitcoin ($BTC) appears to be consolidating around its current level of $65.000 ahead of what could be a massive rise to a new all-tie high, with data showing over $7 billion worth of the cryptocurrency were withdrawn from exchanges this month.
The exchange exodus, pointed out by popular cryptocurrency analyst Woominkyu onn the microblogging platform X (formerly known as Twitter), came with a total of $3.8 billion worth of BTC leaving exchanges on July 5, when the cryptocurrency rose from $56.000 to $65.000.
It was then compounded with, on July 16, an additional $3.4 billion worth of Bitcoin leaving exchanges, with the price now hovering around $65.000 once again.
On July 5th, a total of $3.8 billion worth of #BTC was withdrawn from exchanges, which coincided with the price of BTC rising from $56K to $65K.
Then, on July 16th, an additional $3.4 billion worth of #BTC was withdrawn from exchanges when the price was around $65K.#BTC… pic.twitter.com/pEnqOwiQ77
— 우민규 (Woominkyu) (@Woo_Minkyu) July 18, 2024
Historically, exchange outflows have been interpreted as a bullish signal. When investors transfer their Bitcoin to wallets they control the private keys to, it indicates a desire for greater control over their holdings, potentially reducing selling pressure. With less Bitcoin readily available on exchanges, scarcity could drive prices higher if demand remains constant or rises.
Beyond the withdrawal trend, another analyst pointed to the declining Realized Profit and Loss Ratio metric. This metric gauges market sentiment by analyzing profits and losses across the Bitcoin market. The current multi-month low suggests that investors who bought at highs have already cashed out, which potentially signals a market less likely to experience significant selling in the near future.
However, analysts caution that a sustained price increase may hinge on surpassing key resistance levels.
The Realized Profit and Loss Ratio metric has dropped to extremely low values after profits were taken at the 72K level.
Everyone who wanted to sell at 72K has done so, therefore, for the next profit to be realized, the market needs a new level above the all-time high (ATH). pic.twitter.com/jzxcOGPl2M
— Axel Adler Jr (@AxelAdlerJr) July 18, 2024
As CryptoGlobe reported, adding to the bullish sentiment is the fact that over one-third of the Bitcoin owed to creditors of the now defunct cryptocurrency exchange Mt. Gox has now been distributed, with little to no impact being felt on the price.
According to data shared by the cryptocurrency analytics firm on the microblogging platform X (formerly known as Twitter), 36% of the 141,686 BTC held by the Mt. Gox trustee has already been distributed and moved to their former users.
Mt Gox, which was at one point the largest Bitcoin trading platform, was hacked in 2011 and ultimately filed for bankruptcy in 2014. Recent transactions reignited anxieties surrounding a potential sell-off by creditors who are in line to receive a portion of the $9 billion Bitcoin hoard Mt. Gox has held since its 2014 bankruptcy and led to price drops.
Featured image via Unsplash
