The on-chain analytics agency Glassnode has revealed how a preferred fable surrounding the decline of the Bitcoin trade provide isn’t actual.
Obtainable Bitcoin Provide Hasn’t Really Dropped A lot
In its newest weekly report, Glassnode has mentioned a couple of false impression that’s broadly held within the Bitcoin group across the decline within the Steadiness on Exchanges throughout this cycle.
The “Steadiness on Exchanges” right here refers to an on-chain indicator that, as its identify suggests, measures the entire quantity of the cryptocurrency that’s sitting within the wallets of all centralized exchanges.
Usually, one of many foremost the reason why traders deposit to the exchanges is for selling-related functions, so the Steadiness on Exchanges is usually checked out because the obtainable promote provide of the asset. Will increase within the metric, subsequently, are thought-about bearish for BTC’s worth, as they counsel extra holders are prepared to half with their tokens. Equally, declines will be assumed to be bullish.
Now, right here is the chart for the Bitcoin Steadiness on Exchanges shared by the analytics agency within the report:
The worth of the metric seems to have seen a plunge in latest months | Supply: Glassnode’s The Week Onchain – Week 4, 2025
As displayed within the above graph, the Bitcoin Steadiness on Exchanges was sitting at 3.1 million BTC in July 2024, however right this moment, it has declined to simply 2.74 million BTC. This can be a vital lower and has made many imagine that this represents the creation of a ‘provide shock‘ for the asset.
Glassnode thinks in any other case, nonetheless, because the analytics agency has defined:
Whereas many interpret this as a type of provide shock brought on by a mass of cash being withdrawn by particular person traders—doubtlessly creating upward worth strain—we imagine nearly all of this decline stems from cash reshuffling into ETF wallets managed by custodians like Coinbase.
The spot exchange-traded funds (ETFs) are funding autos that had been launched within the US at first of final 12 months. They provide an alternate technique of gaining publicity to the asset, in a mode that’s acquainted to conventional traders. This mode of BTC investing has rapidly gained recognition and right this moment, the spot ETFs management a notable quantity of the availability.
“After the SEC authorised Bitcoin Spot ETFs in January 2024, eight of 11 spot ETFs chosen Coinbase as their custodian,” notes Glassnode. “As demand for ETF merchandise picked up, a major migration of cash from trade wallets into Coinbase’s institutional custodian wallets occurred.”
Under is the chart shared by the analytics agency that reveals the development within the holdings of those spot ETFs.
Appears to be like just like the ETFs mixed maintain 1.69 million BTC in the mean time | Supply: Glassnode’s The Week Onchain – Week 4, 2025
An attention-grabbing image seems if the Bitcoin holdings of the spot ETFs are included with these of the exchanges.
How the mixed stability on exchanges and ETFs has modified over the previous few years | Supply: Glassnode’s The Week Onchain – Week 4, 2025
From the graph, it’s obvious that this mixed indicator is sitting at a worth of three.04 million BTC proper now. That is about the identical stage as the place the market was initially of 2024, proper earlier than the spot ETFs had been launched.
Primarily based on this, the analytics agency has concluded that the obvious decline within the Bitcoin Steadiness on Exchanges is extra prone to characterize a shift in market construction, moderately than a lower within the obtainable promote provide.
BTC Worth
Bitcoin has made restoration of about 3% previously day, which has taken its worth past $105,000.
The value of the coin appears to have retraced its latest plunge | Supply: BTCUSDT on TradingView
Featured picture from Dall-E, Glassnode.com, chart from TradingView.com
