“The underappreciated aspect is that this measure documents the end of the exchange custody era,” said Ben Nadareski, CEO of Solstice. The bigger problem may not be the decline in foreign exchange balances themselves, but rather where these assets are going.
“Assets are leaving trading platforms for two destinations: regulated custody on one side, productive on-chain positions on the other,” he said.
Furthermore, the argument that increases always follow a steady decline in the foreign exchange balance is not necessarily true. For example, in 2022, supply on the exchanges remained low, but prices collapsed sharply.
HODLing is real
Although the indicator may not be as reliable as before, this does not change the fact that various market participants are accumulating BTC in anticipation of a price increase.
“More than 130 public companies now hold bitcoin on their balance sheets, and spot ETFs have taken up a growing share in regulated custody,” Zalan said.
According to Bitcoin Treasuries, public companies hold approximately 1,264,579 BTC, private companies 281,752, government entities 649,954, DeFi and other protocols 369,595, while ETFs and exchanges hold 1,622,533. Its data also shows that treasury companies hold approximately 7.252 million ETH.
Combined with nearly 7 million bitcoins in dormant wallets, a total of just under 11.2 million bitcoins are outside of active trading, representing approximately 56.5% of the currently circulating supply of approximately 20.05 million.
