Bitcoin’s next halving is coming soon, and over $1 billion has been moved off the exchange
Coinbase’s Bitcoin holdings have been reduced to their lowest level in nine years after users transferred a large portion of their holdings from the exchange.
A report from CryptoQuant indicates that 18,000 Bitcoin worth nearly $1 billion were moved off Coinbase last weekend in transfers ranging from $45 million to $171 million. The exchange’s public order book currently holds about 394,000 BTC, worth about $20.5 billion.
Largest hourly #Bitcoin outflow in 2024 from Coinbase today: 18,746 Bitcoin moved in two transactions at the same block.
However, the transactions have all the patterns that would suggest:
– The Bitcoin is going into custody (input consolidation, new addresses being created… pic.twitter.com/FvH1wBXg1X— Julio Moreno (@jjcmoreno) February 19, 2024
Whales transferring BTC holdings from centralized exchanges is a bullish indicator, as less Bitcoin is on the open market. However, social media users are split on the reason for the transfers. Many believe the funds will be moved to custodial wallets in anticipation of a price increase, with Bitcoin halving only two months away, causing a supply shock.
Some commented that the transferred funds could be used as liquid assets for trades made over-the-counter (OTC). Others think that the funds could be sent to a different custodian and can’t be considered individual withdrawals, as most of the holdings in exchanges “don’t belong to them anyways, so this number should be a lot lower.”
The amount of new BTC introduced to the market is lowered by 50% with each halving cycle, forming a supply crunch as demand rises. The April BTC halving will be at a block height of 740,000, and the block reward for each block mined will be lowered from 6.25 BTC to 3.125 BTC.
The impending halving also comes during a period of enormous institutional demand after 11 spot Bitcoin exchange-traded funds (ETFs) were authorized in the US in January. Bitcoin’s current price of around $52,000 is the highest since December 2021 and 25% less than its all-time high of about $69,000.
