The desire for Bitcoin, the leading cryptocurrency represented by the symbol $BTC, is rapidly increasing at an extraordinary rate. At the same time, the amount of Bitcoin kept in crypto exchanges has shrunk to historical minimums. This reduction in supply might indicate an impending supply shortage that could push prices up.
Based on information from CryptoQuant, led by its Head of Research Julio Moreno, the need for Bitcoin exceeds its availability for the first time. According to their data, the desire for Bitcoin among long-term investors surpassed the amount that was recently released into circulation.
The desire for Bitcoin is increasing faster than new coins are being released into circulation.
— Julio Moreno (@jjcmoreno) April 9, 2024
According to the data from CryptoQuant, approximately 9.8% (around 1.94 million) of all circulating Bitcoins are currently stored in known exchange wallets. This equals roughly 10 million US dollars worth of Bitcoin, given the current market price.
The amount of Bitcoin held in exchange reserves has been gradually decreasing since its peak of 2.85 million BTC in July 2021. This reduction in the available supply on exchanges indicates that investors are adopting a more long-term approach to their holdings, moving away from frequent buying and selling.
Remarkably, a smaller quantity of an asset up for grabs in exchanges could cause a supply shortage if demand were to unexpectedly spike. A supply shortage transpires when the existing stock of an asset on exchanges plummets while demand rises.
When a supply shock occurs, the demand to buy increases in order to keep up with the disrupted supply. This increase in buying pressure causes prices to go up. Short sellers may be forced to purchase more to prevent being liquidated, which amplifies the price rise. Alternatively, short sellers who are unable to cover their positions may undergo forced liquidations, further fueling the price increase.
The Bitcoin supply could be significantly affected by an unexpected reduction, as the reward given to miners for discovering a new block on the network will decrease from 6.25 BTC to 3.125 BTC following the upcoming halving event. This means that roughly half the amount of newly created Bitcoins will enter the market.
The cryptocurrency’s monetary policy includes a halving event, which is scheduled to take place around April 20. This event occurs approximately every four years and is reached after the mining of 210,000 blocks.
Read More
- When Whitney Houston’s Mother, Cissy Houston, Opened Up About Pain Of Outliving Daughter
- EUR HUF PREDICTION
- RIF PREDICTION. RIF cryptocurrency
- ZRO PREDICTION. ZRO cryptocurrency
- Deadpool & Wolverine Director Reveals The ‘Dirty Line Of Dialogue’ That Didn’t Make The Final Cut
- Tower of God Season 2: How Sequel Needs to Clear Pilot’s Mess
- ‘Very Naturalistic Actors’: The Crow Director Rupert Sanders Reveals Why Bill Skarsgard And FKA Twigs Are ‘Right’ For Their Roles
- When Justin Bieber Shared His Thoughts On Being Famous At An Early Age And Called It ‘Toughest Thing In The World’
- ‘I’ve Questioned Whether…’: Joshua Jackson Opens Up About Period Of ‘Bumps and Bruises’ In His Acting Career
- Was the Fed’s Large Rate Cut Designed to Gift Kamala Harris the U.S. Presidency?
2024-04-10 04:34