Creating a new low in this cycle also means that more BTC is being mentioned in centralized on-chain reserves and has not been sent to exchanges for sale. The last time the balance was at such a low level was on December 17, 2022, after the FTX collapse, when a lack of trust in centralized exchanges led to a mass withdrawal movement, causing a dramatic drop in exchange balances.
The short-term price is significantly influenced by Binance's BTC balance. Since the beginning of April 2024, there have been four obvious rapid increases, which correspond to a weakening of BTC's price during the same period.
The changes in Binance's BTC balance are closely related to the strength of selling pressure in the market. An increase in value often applies pressure on short-term prices. Recently, the balance has been consistently declining, which provides the necessary conditions for a rebound.
In particular, I noticed that the behavior of large holders (over 1 million and 10 million USD) is consistent, primarily focusing on on-chain withdrawals, while retail investors (under 100,000 USD) are depositing funds. This aligns with the data we mentioned a few days ago, indicating that on-chain whales have indeed begun to accumulate chips.
To compare, this is quite similar to the period of July to August 2021, where the behavior of large holders was consistent with external withdrawals. However, during the period from January to March 2022, there was a gap in the behavior of large holders, with external withdrawals exceeding 1 million USD and deposits exceeding 10 million USD. When the selling pressure on-chain and off-chain is simultaneously cut off, the speed of demand decline is dying, creating conditions for a rebound. Therefore, I personally believe that the current rebound of BTC after 8 weeks of decline has not yet ended. However, whether it can continuously release momentum will depend on observing subsequent changes in sentiment and risk appetite.
