3 years ago
295 Data acquired from on-chain cryptocurrency information aggregator Glassnode shows that the number of Bitcoin (BTC) held on the centralized exchanges has dropped by around 20% in the last 12 months. This data means that investors are accumulating bitcoin and then withdrawing them from exchanges into cold wallets creating a supply crunch.
#Bitcoin Balance on Exchanges taking another dive pic.twitter.com/F20tohfXsu
— William Clemente III (@WClementeIII) March 7, 2021
Glassnode also shared data on March 6 revealing that coins acquired in 2021 were not moved at a loss in the late February dip, according to on-chain analysis. Notably, long-term accumulation and the increasing popularity of DeFi yield protocols are siphoning BTC away from most of the centralized exchanges.
Based on the firm’s “Hodlwaves” metric that measures the time since coins were last moved on-chain, also suggests that there is an increasing accumulation activity. Hodlwaves data acquired on February 22 indicated that 57% of Bitcoin’s supply has not moved in over a year.
Nonetheless, over a third of the said bitcoins are yet to move in over five years, suggesting that a considerable segment of the coins may have been lost. The surging popularity of decentralized exchanges and DeFi yield protocols may also be driving the dwindling supply of bitcoin on centralized exchanges.
The total value locked (TVL) of BTC tokenization protocol Wrapped Bitcoin has surged by over $1 billion since the start of this month, according to DeFi Llama. That shows a strong demand for Bitcoin in the DeFi ecosystem.
Wrapped Bitcoin TVL: DeFi Llama
