Bitcoin (BTC/USD) balances on exchanges are at a one-year low with just 2.5 million in exchange wallets. Coinbase has the largest outflow and Binance is the only exchange recording inflow of funds instead of outflow, analytics service Glassnode reported. In May, there was a 2.5 million balance when the price of Bitcoin reached $62,000.
Causes of outflow
Bitcoin and altcoin price actions are the main factor accounting for the trend. The most recent market consolidation caused holders to redistribute funds rather than a major increase in exchange inflow. As old addresses took most of the profit from investors, their hands have become “younger”. On average, the profit was a whopping 250-300% profit.
Bitcoin hashrate keeps rising
Glassnode reported that the Bitcoin hashrate is gradually increasing from a low in July as miners relocate from China and get to work. This also means miners are selling. The service notes that there isn’t much competition among miners against the backdrop of global production constraints on ASIC chip manufacture. Glassnode adds:
“As a result, miner USD revenue per hash has now risen back to July 2019 levels of $380k per Exahash, making operational miners exceptionally profitable on a historical basis.”
Miners have spent a total of BTC 2,900 worth $145 million as Bitcoin moved past $50K over the last week. Considering that most funds disclose neither the volumes they’re buying or selling nor the actual deals, the role of institutional investors is not very clear. Other causes of outflow include El Salvador’s adoption of Bitcoin as legal tender. The government purchased BTC 400 recently. To support the president’s progressive decision and vision, a number of social media influencers even encouraged followers to buy BTC.
More people are opting for the king of crypto as a hedging or investment tool apart from investors not selling or taking profits. Last week, the digital assets market was characterized by large inflows with as much as $100 million having been invested in the sector. Inflow amounted to $140 million three weeks in a row. At the moment, the altcoin market is taking a record market share of 35%.
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