Bitcoin Hits Historic Milestone: Exchange Balances Plummet, Price Nears $100,000

Bitcoin is approaching a record price of $98,000, while the amount of $BTC on exchanges has fallen to an all-time low, according to on-chain analysis from 10X Research.

Supply Scarcity

Data shows that the amount of Bitcoin available for purchase on exchanges has sharply decreased, in stark contrast to the inventory increase during the summer. Currently, only three major exchanges—Binance, Bitfinex, and Coinbase—have enough reserves to meet demand.

This decline is primarily due to long-term holders continuing to hold, limiting the amount of Bitcoin flowing into exchanges and reducing market liquidity.

Growth Drivers

Bitcoin is being driven by positive policy changes:

• Donald Trump has committed to establishing a Bitcoin reserve fund in the United States and protecting the cryptocurrency mining industry.

• The increase in demand from both retail and institutional investors, including financial products like spot Bitcoin ETFs.

Price Impact

Charts from Glassnode show a contrasting trend between Bitcoin balances on exchanges (blue line) and price (logarithmic scale). Bitcoin prices surged in the latter half of 2024, nearing $100,000.

The supply scarcity, combined with growing demand, may continue to push Bitcoin prices higher, enhancing the appeal of this currency as a store of value.

Conclusion: With support from policy and investor confidence, Bitcoin is proving its solid position in the global financial ecosystem.