Bitcoin’s on-chain data shows: the “exchange reserve indicator” looks completely different in the current sell-off than in the crash in May.

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Bitcoin Spot Stock Market Reserve Continues to Fall Despite Huge Slump

As outlined in a CryptoQuant post, BTC reserve on spot exchanges has actually declined amid the current price slump.


The Bitcoin reserve of all exchanges is an indicator that shows the amount of coins in the wallets of all centralized spot exchanges. If the value of the reserve moves up, it means that more investors send their BTC to exchanges to withdraw them for the purchase of fiat or altcoins.

Similarly, a downtrend in the metric means that investors subtract a net amount of Bitcoin from exchange wallets into personal wallets to hoard or sell through OTC trades.

Here is a chart showing how the value of the indicator has changed over the past year:

Bitcoin Stock Market Reserve Appears to Be Declining / Source: CryptoQuant

Looking at the graph above, some interesting features can be seen. In the run-up to the bull run in 2021, the exchange reserve decreased from a very high value. This makes sense – because a downtrend like this means that investors are accumulating more coins, which can push up the price.

This could have been the trigger of the sale

Then, when Bitcoin hit its all – time high (ATH), the metric quickly began to rise again, suggesting a sell-off-and the price crashed as a result.

However, the current slump looks different. BTC reserves were actually down, suggesting that investors are not getting out as quickly on these spot exchanges.

That, in turn, would mean that this sell – off was triggered entirely by derivatives-as opposed to the May crash, in which spot exchanges also played a big role.

Currently (time of this article), the Bitcoin price is around $ 47,000, which is a 5% drop in the last 7 days. Over the past month, cryptocurrency has gained 3% in profits.

The following chart shows the performance of the coin over the last five days.

The price of BTC shows great volatility / Source: BTCUSD on TradingView

Two days ago, Bitcoin experienced an absolute price chaos when the value of the coin fell from $ 50,000 to $ 43,000 within fifteen minutes. And just a few minutes later, BTC had already recovered to over $ 47,000.

Yesterday, the value of the coin fell back to $44.4 k – but now it’s already back above $46k. At the moment, it’s hard to say where the price will move next, but one thing you can certainly expect: more volatility in the future.

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Text credits: Newsbtc

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