Bitcoin (BTC), the world’s largest cryptocurrency, has shown significant strength, gaining 3% in the last 24 hours. This increase brought the crypto asset close to the $38,500 level and increased its weekly gain to an impressive 4.5%. However, the attention is not just on price action; On-chain data reveals a significant movement of Bitcoins from exchanges, pointing to a potential bullish catalyst. Now let’s examine the details.
Massive Bitcoin outflow from exchanges
On-chain data shows that there is a significant outflow of Bitcoin from exchanges, reaching the lowest level in the last five years. This trend has been attributed to the declining reputation of exchanges, with recent events such as Binance’s $4.3 billion settlement and Coinbase facing CFTC subpoenas over its dealings with Bybit’s derivatives trading platform. At the same time, the 10 largest Tether exchange wallets now have a combined value of $15.23 billion, marking the highest level of exchange purchasing power in 17 months. This shift in dynamics raises questions about the changing landscape of cryptocurrency assets and their impact on market trends.
November saw Bitcoin show notable resilience, especially in its positive correlation with the stock market. Analysts are watching this trend closely, as Bitcoin moving higher regardless of the stock market could mark a significant departure from established norms and potentially signal an uptrend. Despite regulatory actions targeting exchanges and lack of approval for a spot BTC Exchange Traded Fund (ETF), Bitcoin has surged above $38,000. While investors continue the uptrend by finding support near $37,900, concerns remain about a potential bearish move testing the critical support zone at $35,600.
What do analysts say?
Amid market fluctuations, PlanB, the creator of the stock-to-flow model, expresses confidence that the Bitcoin price will not fall below $35,000 again. As Bitcoin hovers around $38,000, the market awaits potential developments, including the approval of spot bitcoin ETFs and views from global financial institutions such as Standard Chartered, which predicts $100,000 Bitcoin by the end of 2024.
Some altcoin projects experienced an increase
Meanwhile, Solana’s SOL tokens led gains among layer-1s, rising nearly 8% in the last 24 hours, reversing last week’s losses. Avalanche’s AVAX is up 6.6%, while Cardano’s ADA and Tron’s TRX are up over 5%. Bitcoin momentum began to pick up late Tuesday as U.S. Federal Reserve Chairman Chris Waller said the latest data showed a slowdown in the economy and that the continued moderation in inflation showed current policies were “in the right spot.” Waller also said that if inflation continues to fall, there is a good argument for cutting rates in a few months.
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Read more: Bitcoin Shifts Up a Gear: These Altcoins Are Taking Flight! So why?