Bitcoin stored in exchange wallets hit highest since early May

The amount of Bitcoin that was seen stashed in the wallets of centralised cryptocurrency exchanges has risen to the highest level it has ever been since early May of this year. Analysts now expected the ongoing bull run of the market to take a breather.

The development was revealed by blockchain analytics firm Glassnode’s Bitcoin exchange net position change metric which shows 30-day change of the supply held in exchange wallets.

The figure for Bitcoin rose to 31,382.43 BTC ($1.16billion) on Sunday, which is the highest compared to the same date four weeks ago on 11 May 2023. This has taken the total balance held on exchanges to 2.35 million $BTC.

An inflow of cryptocurrency into exchange wallets usually depict investors’ intention to liquidate their holdings. This then results in a potential selling pressure or deploying coins as a margin in futures and options markets. An outflow in the same represents accumulation of the cryptocurrency.

According to Glassnode, the $BTC exchange net position change has consistently remained positive since 1 November. As seen in the past, such periods have coincided with the occurrences of a pause in bull market or price pullbacks.

Since the level stood at the highest since May, analysts predicted a similar development for the top coin. However, some also believed the latest inflow to signify renewed investor confidence in centralised exchanges.

Many investors were seen moving their coins off exchanges and into their direct custody in the aftermath of the catastrophe associated with Sam Bankman-Fried and his now-collapsed exchange FTX, which was the third largest last year before it went down.

Following this, the CEO of the top cryptocurrency exchange Binance, Changpeng ‘CZ’ Zhao, advocated for taking personal control of digital assets saying that “self-custody is a fundamental human right”.

In doing so, he advised investors to use Trust Wallet, which is a decentralised hot wallet acquired by Binance in 2018 facilitating the storage of cryptocurrencies and non-fungible tokens (NFT).

At the time of press, Bitcoin continued enjoying bullish pressure as it rose by almost 2% in the last 24 hours. The crypto was trading on the green side in its charts, changing hands for around £37,000, as of writing.

Almost all of the top coins were rising in price too as the broader crypto market climbed by over 2% in a day, raising its market capitalisation to $1.47trillion, according to CoinMarketCap.