“The hidden angle is that this metric is documenting the end of the era of currency custody,” said Ben Nadareski, CEO of Solstice. The most important issue may not be the fall in exchange balances themselves, but rather where those assets are being moved.
“Assets are leaving trading venues with two destinations: regulated custody on the one hand and productive on-chain positions on the other,” he said.
Furthermore, the argument that bull runs always follow a constant decline in the exchange balance is not necessarily true. For example, in 2022, supply on stock exchanges remained low, but prices plummeted sharply.
HODLing is real
While the indicator may not be as reliable as before, it does not change the fact that a variety of market participants are accumulating BTC in anticipation of a price increase.
“More than 130 public companies now have bitcoin on their balance sheets, and spot ETFs have absorbed an increasing proportion in regulated custody,” Zalan said.
According to Bitcoin Treasurys, public companies hold around 1,264,579 BTC, private companies 281,752, government entities 649,954, DeFi and other protocols 369,595, while ETFs and exchanges hold 1,622,533. Their data also shows that treasury companies hold around 7.252 million ETH.
Combined with nearly 7 million bitcoins in inactive wallets, a total of just under 11.2 million bitcoins are out of active trading, representing about 56.5% of the currently circulating supply of about 20.05 million.
