- Bitcoin exchange balances have dropped by nearly $10 billion in 2024 as demand has surged from new spot ETFs and ahead of the upcoming halving.
- Exchanges have seen over 136,000 BTC withdrawn since January when US spot ETFs launched, with no signs of profit-taking as exchange balances hit multi-year lows.
- Optimism is growing that the halving in mid-April, which cuts the block reward and BTC supply inflation rate in half, along with ongoing ETF buying, will squeeze available supply further and drive prices up.
Bitcoin exchange withdrawal trends are clear as pent up demand from the spot ETFs combines with the upcoming halving to squeeze the available BTC supply.
Bitcoin Exchange Balances Declining
Bitcoin worth nearly $10 billion has left crypto exchanges since the United States launched spot exchange-traded funds (ETFs).
Data from on-chain analytics firm Glassnode shows that since Jan 11, exchanges are down over 136,000 BTC.
No Signs of Profit-Taking
Bitcoin supply dynamics continue to sway in bulls’ favour as exchanges see mass withdrawals this quarter.
The US spot Bitcoin ETFs have been trading less than three months but, in that time, around $95 billion worth of BTC has been withdrawn from major trading platforms.
As of March 28, the exchange tracked by Coinbase held a combined 2,320,458 BTC – the lowest balance since April 2018.
The trend shows no sign of slowing. Glassnode shows that on March 27 alone, withdrawals totalled more than 22,000 BTC ($1.54 billion) – the third-largest daily tally of 2024.
Optimism Grows Ahead of Halving
The ETFs long-term impact on the available BTC supply (and hence price) is an increasingly hot topic among market observers.
As Cointelegraph reported, several sources now predict that a major squeeze in supply – demand outpacing the BTC available for sale – will make itself felt within the next six to twelve months.
ETF buying alone already represents a much larger buying force than the new BTC unlocked each day by miners. After the upcoming block subsidy halving event in mid-April, that ratio will increase even more as the BTC supply expands by just 3,125 BTC per newly-mined block.
The biggest Halving in Bitcoin’s history is just days away,” Charles Edwards, founder of quantitative Bitcoin and digital asset fund Capriole Investments, wrote in part of his latest market commentary.
“For the first time Bitcoin will become harder than gold with half its supply growth rate. Pent up institutional demand via the ETFs, a programmatic supply squeeze from the Halving and Bitcoin taking the title as the world’s hardest asset. There’s a lot to look forward to in April.”
