Bitcoin Exchange Balances Hit Rock Bottom: Are We On The Verge of A Major Bull Run?

Amid
anticipating
the
major
post-Havling
rally,
Bitcoin
(BTC)
exchange
reserves
have
hit
an
unprecedented
low,
falling
below
$2
million.
This
trend
is
particularly
noteworthy
as
it
signals
an
impending
price
for
BTC.

Thomas
Fahrer,
co-founder
of
Apollo,

echoed
this
in
his
recent
post
on
the
social
media
platform
X,
noting
that
the
dwindling
BTC
exchange
reserves
could
be
the
harbinger
of
a
significant
uptick
in
price,
particularly
with
the
anticipated
influx
of
ETF
flows.

Bitcoin
Outlook:
A
Bullish
Signal

In
his
post
on
X,
Fahrer
emphasized
that
Bitcoin’s
current
low
levels
on
exchanges
could
spark
a
parabolic
price
surge,
driven
by
a
potent
mix
of
“Demand
shock
+
Inelastic
supply.”

#Bitcoin
Exchange
Reserves
are
at
all
time
lows.

Right
on
time
for
a
second
wave
of
ETF
Flows.

Demand
shock
+
Inelastic
supply
=
🚀🚀🚀

pic.twitter.com/Ku9B4UVk4R

—
Thomas
|
heyapollo.com
(@thomas_fahrer)

May
20,
2024

His
comments
reflect
a
growing
optimism
among
investors
who
view
the
plunging
exchange
supply
as
an
indicator
of
an
upcoming
bullish
market
phase.
This
trend,
particularly,
suggests
that
numerous
investors
are
transferring
their
BTC off
exchanges,
likely
opting
to
hold
them
long-term
in
anticipation
of
rising
prices.

Furthermore,
the
evolving
dynamics
in
BTC’s
exchange
supply
are
part
of
a
larger
pattern
that
includes
substantial
institutional
interest,
fueling
speculation
about
a
forthcoming
second
wave
of
ETF
inflows.

Such
inflows
are
expected
to
diminish
the
available
supply
of
BTC
further,
exacerbating
the
supply
squeeze
and
potentially
driving
prices
upward.

Institutional
players,
including
hedge
funds
and
public
pensions,
are

increasingly
accumulating
through
ETFs.
This
trend
marks
a
significant
shift
in
how
traditional
financial
entities
perceive
these
assets.

For
instance,
Thomas
Fahrer

points
out
that
Horizon
Kinetic
Asset
Management
has
made
a
significant
commitment
to
BTC.
The
firm
has
invested
$913
million
in
IBIT
and
GBTC,
representing
approximately
14%
of
its
total
$6.5
billion
in
assets
under
management.

Forget
2-3%
Allocation.

Horizon
Kinetic
Asset
Management
has
$913M
of

#Bitcoin
invested
in
IBIT
+
GBTC
making
up
14%
of
their
$6.5B
AUM

This
is
investing.
🔥

pic.twitter.com/ntn6hTEblY

—
Thomas
|
heyapollo.com
(@thomas_fahrer)

May
20,
2024

This
massive
allocation
highlights
the
growing
confidence
that
major
institutions
have
in
the
future
of
BTC.

Retail
vs.
Institutional:
A
Divided
Market

While
institutional
investors
pile
into
BTC
ETFs,
retail
investors
seem
more
cautious.
Bitcoinist
recently
cited
IntotheBlock’s
report

revealing
a
bifurcated
market
where
hedge
funds
and
pension
funds
actively
increase
their
BTC
holdings
through
ETFs.
In
contrast,
the
average
investor
remains
on
the
sidelines.

This
division
is
highlighted
by
the
recent
activities
of
whales
(large
investors)
who
have
added
250,000
Bitcoins
to
their
holdings,
returning
their
total
to
levels
seen
before
the
FTX
collapse
in
2023.

Hedge
funds,
expected
to
be
major
players
in

institutional
adoption,
have
not
disappointed.
Firms
like
Millennium
Management
have
invested
billions
in
BTC
ETFs,
showcasing
their
belief
in
the
cryptocurrency’s
potential.

Public
pensions
are
also
entering
the
fray,
with
the
state
of
Wisconsin
investing
$160
million
in
Bitcoin
ETFs.
This
move
highlights
the
growing
acceptance
of
BitBTCcoin
in
traditional
investment
portfolios.

Moreover,
Morgan
Stanley’s
recent
filings

reveal
significant
investments
in
the
Bitcoin
ETF
market.
The
bank
has
purchased
31,712
shares
of
Ark’s
21Shares
ETF
(ARKB)
and
allocated
$269
million
to
the
Grayscale
Bitcoin
Trust
(GBTC).

These
investments
have
made
Morgan
Stanley
the
third-largest
holder
of
GBTC
shares
and
a
top
20
investor
in
Ark’s
ETF,
indicating
strong
institutional
interest
in
BTC.

Featured
image
from
Unsplash,
Chart
from
TradingView