Bitcoin Exchanges Witness $10B Drop in BTC Balances in 2024

Since the launch of spot exchange-traded funds (ETFs) in the United States, around $10 billion worth of Bitcoin (BTC) has been withdrawn from cryptocurrency exchanges, according to data from on-chain analytics firm Glassnode. This trend does not seem to be slowing down, as Bitcoin supply dynamics continue to favor the bulls, with mass withdrawals seen this quarter. The trend is particularly evident on Coinbase, which currently holds the lowest balance of BTC since April 2018. In fact, on March 27 alone, withdrawals totaled more than 22,000 BTC, marking the third-largest daily tally of 2024. There has been a significant transfer of stablecoin USD Coin (USDC) to Coinbase, suggesting strong buying pressure.

The long-term impact of these ETFs on the available BTC supply and its price has become a hot topic among market observers. It is predicted that within the next six to twelve months, there will be a major “squeeze” in supply, where demand exceeds the BTC available for sale. The buying force from ETFs alone is already larger than the amount of new BTC unlocked by miners each day. After the upcoming block subsidy halving event in mid-April, the ratio will increase even more, as the BTC supply expands at a slower rate.

Charles Edwards, founder of Capriole Investments, wrote in his market commentary that the upcoming block subsidy halving event will be the biggest in Bitcoin’s history. This event will make Bitcoin harder than gold, with its supply growth rate halving. Combined with pent-up institutional demand from ETFs and the programmatic supply squeeze from the halving, Bitcoin is expected to become the world’s hardest asset. All of this is anticipated to happen in April, creating a positive outlook for Bitcoin.

The launch of ETFs in the United States has resulted in a significant amount of BTC being withdrawn from exchanges. This, combined with the upcoming block subsidy halving event, is expected to create a supply squeeze and increase Bitcoin’s value. The market is optimistic about the future of Bitcoin, with April being a highly anticipated month for the cryptocurrency.