With each passing day, more and more people join the crypto world. A good part of them attracted by the promise of the great profits that can be achieved in the market. Especially if you participate in cryptocurrency trading through the multiple platforms that exist in the world. However, despite the popularity of trading, the amount of Bitcoin on exchanges is at its lowest level in a long time.
The importance of trading for the crypto world
It is impossible to underestimate the importance of exchanges for the crypto world. Well, it is these platforms that allow the communication of the different cryptocurrencies. Which are exchanged for each other within these exchanges, defining their value. Therefore, that of the projects that support them, through the laws of supply and demand.
Thus, a person anywhere in the world who owns Bitcoin and wants to acquire Ethereum, XRP or Dogecoin, just enter their trusted exchange, and carry out the exchange. What also opens the doors to the possibility of enriching yourself through trading. Taking advantage of small (or large) variations in the price of cryptocurrencies to generate profits.
This has led, over time, to the general public starting to relate cryptocurrencies to trading. With some people like investor and crypto skeptic Peter Schiff, declaring that the only real value of Bitcoin is that of being a speculative financial asset. For some savvy investors to make a profit.
But beyond these judgments that overlook the infinite possibilities that Blockchain technology opens. The truth is that trading has gained great popularity, as the main economically profitable activity in the Bitcoin and other cryptocurrency markets. Which does not prevent the amount of Bitcoin on exchanges from being at its lowest level in a long time.
Less and less Bitcoin in exchange
Thus, a study by Glassnode shows that the number of Bitcoin on exchanges has been constantly decreasing since the end of March this year. Moving from more than 2,600,000 Bitcoin within the entire crypto market ecosystem of exchanges. Up to less than 2,350,000 Bitcoin for this last week.
Such an abrupt drop in the amount of Bitcoin managed by exchanges represents the largest decrease in this statistic on record. Probably the main culprit behind this negative performance in the economic crisis caused by the Coronavirus.
And it is that, the exit of BTC from the exchanges of the crypto market began to occur in mid-March. Just when the global financial market collapsed with the arrival of Covid-19 in the west. Dragging the price of Bitcoin and gold with it. This generated a confidence crisis that led to massive withdrawals of Bitcoin by users of exchanges such as BitMEX.
However, there is a more positive explanation for the crypto world. Well, the arrival of the third Bitcoin Halving has brought with it great optimism within the crypto community. Which expects a substantial increase in the price of BTC. Therefore, large investors could be withdrawing their cryptocurrencies from exchanges, to keep them waiting for the expected bullish rally.
Be that as it may, the truth is that this reduction in the money stored by users in the crypto world exchanges, brings the crypto market back to the situation it was in at the beginning of 2019. Limiting the liquidity available by the large exchange platforms. And making this fall our Today’s Data here at CritoTendencia.