Key Takeaways:
- Institutional interest in Bitcoin rises.
- The accumulation, combined with macro factors, pushed the flagship crypto to over 50% dominance.
- BTC leaves exchange reserves at the highest rate ever, suggesting a push above $31K.
YEREVAN (CoinChapter.com) – Institutional interest in Bitcoin (BTC) is on the rise. According to the analytical platform CryptoQuant, fund holdings reached their highest peak year-to-date as the BTC price struggled just under $31,000.
Why is it important to watch institutional holdings?
In detail, fund holdings refer to the cryptocurrency holdings of institutional investors, including hedge funds, investment firms, and cryptocurrency private funds. Analyzing the holdings of these funds provides valuable insights into the market dynamics and investor sentiment.
By closely observing fund holdings, we can identify a significant upward trend in the accumulation of bitcoins by these institutional entities. This exponential increase in holdings indicates a strong interest in acquiring Bitcoin, even at its current price level.
read the CryptoQuant report.
The researchers added that the institutional entities are not much interested in short-term price fluctuations. Instead, they exhibit patience and are actively seeking long-term investment opportunities in Bitcoin.
Bitcoin accumulation pushed BTC dominance higher
As a result of the heightened accumulation and its regulatory clarity, Bitcoin’s market dominance grew to 51% on June 28 but corrected to 50.9% in recent days. Moreover, as the chart below shows, BTC dominance retested its 200-week exponential moving average (EMA-200; blue wave) as resistance but crossed over a significant barrier at 50%.
Bitcoin reserves on exchanges are running dry
Moreover, according to CryptoQuant, Bitcoin is experiencing the “largest decline of BTC inflows and supply in history.”
Bitcoin currently reflects an 80% decline over 612 days (and counting) in the number of addresses logging inflows (inferred selling) is a record. That is measuring from October 2021, but if measuring from the May 2021 top, the decline in addresses rises to 84%.
asserted the CryptoQuant experts.
Additionally, the overall Bitcoin supply on exchanges is shrinking. According to the report, it has dropped by over 30% since March 2020. “This is another record in duration and depth,” said the experts.
Also read: Bitcoin Price Hesitates, But Further Gains Seem Likely Toward $34K.
The research concluded that “retail traders and institutions are holding more Bitcoin than ever,” which could contribute to a price increase. As of July 3rd, BTC grappled with a significant resistance line at $31,000. However, given the persistent accumulation, the flagship crypto could overcome the said barrier for the first time in over a year.
