Cryptocurrency News

Coinbase Bitcoin Reserve Drop By $8 Billion As Demand For Bitcoin Skyrockets

The digital asset industry is growing at an impressive rate, including more demand from investors within the space. Bitcoin’s value and success over the years have made it a choice for institutional buyers, who have continued buying up reserves of the crypto, with no plans in sight to sell the digital asset.

Even has Bitcoin faced one of its most significant falls in months, crypto holders continue to buy more assets at a lower price in anticipation of a greener season. While Bitcoin has added around $1000 in 24-hours after its unexpected drop, people have significantly dropped selling pressure as prominent exchanges like Coinbase record a decrease in its Bitcoin reserve, showing that there are more buys than sells of the asset from users.

Coinbase records low BTC supply due to demand

Although the price drop Bitcoin has faced in the last few days, holders continue to demand Bitcoin heavily, and the price drop has not stopped the demands. For some weeks now, Bitcoin has not returned to its $61,000 peak, but that has not stopped various reserves from losing billions of Bitcoin due to the increased purchase.
A well-known crypto data firm, Glassnode, revealed that the Bitcoin supply is on the decrease. This shows some strategy amongst investors as they have refused to sell their crypto, which has caused exchanges’ Bitcoin supply to decrease as months go by.

This supply decrease continues even though Bitcoin has not had a decent gain in days. The hodlers are aggressively holding, and this could mean they would continue holding even when the crypto’s price goes beyond the $60,000 peak. Coinbase is facing Bitcoin supply problems, and the firm explained that the reserve has dwindled by $8 billion or 150,000 BTC since January.

This is what the institutional investors wanted by buying large chunks of cryptocurrency and refusing to sell them, which could skyrocket asset prices within some months. Coinbase understands that the increase shows that buyers are increasingly interested in Bitcoin, and it understands that the hodling might continue.

Institutional buyers taking up the cryptos

Willy Woo, a well-known statistician, spoke on this development. He opined that US-based institutional investors are buying assets heavily from small-scale holders and holding them due to monetary inflation. He added that the firm’s sudden drop in Bitcoin supply shows that large-scale investors are buying the assets.

Interestingly, large-scale buying has had a positive effect on Bitcoin as big firms could skyrocket the crypto’s price within a short period. Bitcoin’s supply might continue to dwindle if the interest continues, and this could mean that the crypto would be very expensive soon.

Glassnode had explained some weeks ago that Bitcoin’s supply was reaching its limits, and that means that when miners finish mining all the cryptos, people would have to start buying from those holding. This would skyrocket Bitcoin’s price as it would be far scarcer than it is now. The institutional interest in Bitcoin would cause a faster decrease of Bitcoin reserve and eventual price growth.

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