Bitcoin Sees Massive Withdrawals from Exchanges as BTC Reserves Reach Lowest Level Since 2018
In a move reminiscent of the mid-2021 market dynamics, Bitcoin is leaving exchanges at an unprecedented rate not seen in years, with daily withdrawals flirting with historical records in terms of US dollars. This phenomenon occurs as the price of BTC struggles to reach new all-time highs, signaling a renewed interest and potentially a long-term holding strategy by investors.
The 3rd of March saw on-chain data highlighting withdrawals of several billion dollars in BTC from exchanges. According to data provided by on-chain analytics firm Glassnode, on March 1st alone, withdrawals amounted to around $2.3 billion.
While the general public investors may not yet be returning to cryptocurrencies en masse, exchanges are rapidly depleting their BTC reserves. March 1st was particularly striking, marking one of the most massive withdrawals in over five years.
This massive movement is fueled by a lack of trust in exchanges and investors’ desire to take direct control of their assets, alongside an impressive bull market.
The Role of Bitcoin Spot ETFs
One can obviously note the role of US Bitcoin Spot ETFs, which would explain part of the withdrawals, except for about $200 million sent to Coinbase Pro. Binance and Coinbase were the main stages for these massive outflows, with Binance alone recording around $400 million in withdrawals.
These movements on Binance are particularly noteworthy because they are not directly related to the ETFs, suggesting a dynamic specific to this exchange.
Bitcoin Reserve at Lowest Since 2018
Glassnode reveals that the total BTC assets available on the major trading platforms it monitors has dropped to 2,286,347 BTC ($142.5 billion) on March 2nd, the lowest amount since March 2018 when BTC was trading at just $8,000.
