Analysis: CEX Bitcoin reserve reduction and stablecoin reserve growth lay the foundation for rising prices
On September 12, CryptoQuant analyst Tarek On-Chain wrote: “Bitcoin’s reserves on exchanges are decreasing significantly, a trend that often occurs before prices rebound. This reduction shows that as investors place Bitcoin Selling pressure eased as a move to cold storage limited available supply.
Historically, such swings are often followed by price peaks, suggesting a similar scenario may be playing out now. At the same time, exchanges’ stablecoin reserves are increasing, indicating that investors are preparing to enter the market. Stablecoins represent capital that can be deployed at any time, and their increasing reserves indicate that traders are waiting for the right time to enter. This growth indicates strong buying interest. The combination of dwindling Bitcoin reserves and increasing stablecoin reserves sets the stage for an upward price breakout.
As Bitcoin supply dwindles and purchasing power increases, the market is primed for a potential rise. Historically, this supply and demand imbalance has resulted in significant price increases. The decrease in Bitcoin reserves and the increase in stablecoin reserves indicate a bullish outlook for Bitcoin. As supply tightens in the market and purchasing power builds, we may be on the verge of a price rebound. Investors should remain alert in the coming weeks for potential market upside opportunities. "
