Many experts consider the reduction in the number of bitcoins on exchanges as a positive signal.
Theoretically, the outflow of cryptocurrency from the trading floors eases the pressure on the asset from sellers. Therefore, the value of BTC should increase against the backdrop of a reduction in its market supply.
On January 29, analysts of the IntoTheBlock platform recorded the largest outflow of cryptocurrency from exchanges since April 18. On this day, investors withdrew 64,000 BTC from the trading floors. As a result, over the past few days, the bitcoin exchange rate has strengthened by almost 18.5%.
If, on the contrary, investors send coins to exchanges, then the supply of the asset increases, and as a result, its price begins to decline.
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This is the trend we observed in May-June 2021, the researchers emphasized. During this time, more than 130,000 BTC entered the exchanges, and after that, the coin collapsed.
On the night of Wednesday, February 9, Bitcoin is trading above $43,000. It tried to get closer to $45,000 the day before but quickly retreated.
According to IntoTheBlock, the zone of strong support is expected to be around $42,000.
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If the expansion resumes, resistance will intensify as BTC approaches $47,000. At this price, 1.42 million addresses have previously purchased more than 900,000 coins, and they can dump crypto to win back losses.