Bitcoin at Record Levels: What’s Happening Behind the Scenes?
As Bitcoin trades in the range of $90K-$91K, on-chain data from Binance, the largest trading platform in the world, shows an extremely rare divergence between deposit and withdrawal behaviors.
It appears that the market is witnessing a wave of aggressive accumulation of Bitcoin.
Data Analysis: What Do the Numbers Tell Us?
1. Huge Increase in Withdrawals:
The exponential moving average (EMA-30) of withdrawals from Binance reached 3100 transactions per day as of December 3rd.
This number is the highest since May 2018, indicating that investors are moving their assets to cold storage instead of keeping them on the platform.
2. Historic Decrease in Deposits:
On the other hand, the exponential moving average (EMA-30) of deposits dropped to 320 transactions per day, the lowest level since 2017.
This decrease reflects a significant weakness in selling pressure, as it seems investors prefer to hold onto their assets rather than sell them.
What Does This Mean for the Market?
This large divergence between withdrawals and deposits creates what is known as a "Supply Shock." Typically, when Bitcoin reaches record levels, we see an increase in deposits as investors take profits.
But this time, the opposite is happening entirely:
1️⃣The available supply for sale is shrinking significantly.
