The strategists at the Bank of America (BofA) have recently released a report stating that Bitcoin’s spectacular rally so far in 2023 comes against the backdrop of the flows between cryptocurrency exchanges and personal digital wallets.
During the week of April 4, a total of $368 million worth of Bitcoins (BTC) have been moved to personal wallets. BofA strategists Alkesh Shah and Andrew Moss wrote that this was 2023’s second-largest net Bitcoin outflow from crypto exchanges.
They said: “Investors transfer tokens from exchange wallets to their personal wallets when they intend to hold them (or HODL), indicating a potential decrease in sell pressure”. As we know, “HODL” is a popular acronym used in the crypto space referring to the idea of holding tokens for the long term.
The strategists also added that concerns us US regulatory crackdown on crypto exchanges may have triggered the outflow. Top market players like Coinbase and Binance are already facing major scrutiny from US regulators in recent times.
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This could be a big week for Bitcoin and the broader crypto market as some macro indicators will be influencing the market. Yesterday, the Bitcoin price surged past $30,000 for the first time since June 2022. Market analysts are confident that $30,000 would act as strong support for Bitcoin and expect another 10-20% rally from here onwards.
Speaking to Bloomberg, Nathan Batchelor, managing partner at analytics platform Biyond Trader said:
On the other side, the Bitcoin network continues to hit new milestones with total addresses shooting past 500K. More Bitcoin addresses and wallets give a bullish price signal going ahead.
For now, the BTC price has dropped a bit under $30,000. The weak ahead would be crucial in determining the next major move.
