- Bitcoin reserves on crypto exchanges have now reached their lowest point in the last six years.
- Fidelity revealed this in a recent report on X, which showed that the supply of Bitcoin on exchanges has fallen to just 2.6 million BTC.
- This stands as the lowest this metric has ever been since November 2018, on the back of investors like Strategy and Metaplanet
Bitcoin reserves on crypto exchanges have now reached their lowest point in the last six years. This observation was made in a recent report from Fidelity Digital Assets. This ongoing decline is largely due to the inflow of Bitcoin purchases from publicly traded companies, as outlined by the report.
Institutional demand for cryptocurrency is ramping up, and the shift is reshaping how Bitcoin is distributed across the market. Here’s what this means for Bitcoin and its future.
Exchange Balances Hit a 6-Year Low
Fidelity Digital Assets is the crypto-focused arm of the $5.8 trillion asset manager Fidelity Investments. In a recent report on Twitter, the firm revealed that the supply of Bitcoin on exchanges has fallen to just 2.6 million BTC, which is the lowest this metric has ever been since November 2018.
More than 425,000 BTC have been withdrawn from exchanges so far, since November of last year alone. This kind of activity shows that investors are not looking to sell their crypto anytime soon.
When Bitcoin is moved off exchanges and into cold storage, it usually shows that long-term holders have confidence in the asset’s value over the long term. Traders tend to keep their funds on exchanges when they require quick access to selling, and the opposite happening shows that more and more investors are seeing Bitcoin as a strategic asset, and not just a trading vehicle.
So Who’s Buying?
Fidelity’s report shows that a large portion of these investments are coming from publicly traded companies. Since November of last year, these firms have collectively raked in around 350,000 BTC, a move that aligns with the falling exchange balances. One of the biggest of these buyers is Michael Saylor’s Strategy (formerly MicroStrategy), which has now become the largest corporate holder of Bitcoin in the world.
Strategy alone has added nearly 286,000 BTC in the past six months. This stands as over 80% of the total public company shares during this time. Their most recent purchase included 6,556 BTC as disclosed by its latest filing on April 21.
A Global Trend, Not Just a U.S. Phenomenon
While most headlines focus on American firms, the trend isn’t confined to the US, as Asian companies are also jumping in. According to reports, Japanese investment firm Metaplanet is one of these big movers, with its current stash of 5,000 BTC. The company has intended to double this amount this year, with its CEO, Simon Gerovich, embracing a Bitcoin-focused treasury like MicroStrategy did.
On the other hand, Hong Kong’s HK Asia Holdings recently revealed plans to raise around $8.35 million, with part of these funds possibly going towards increasing its Bitcoin holdings. These moves show that corporate Bitcoin adoption is expanding across the continents, as the world embraces Bitcoin. Overall, Bitcoin may be young compared to many other assets. However, moves like these from worldwide companies show that it is growing fast, and should be able to go head-to-head with assets like gold at some point.
