Recent data indicates that the supply of Bitcoin (BTC) and Ether (ETH) on crypto exchanges has hit multi-year lows, potentially reflecting a positive sentiment in the market.
BTC and ETH Supply on Exchanges Decreases
According to data from the market intelligence platform Santiment, the supply of BTC on exchanges has fallen to 7.1%, marking the first time since November 2018. Over the last five years, there are 1.7 million fewer BTC on crypto trading platforms.
Similarly, ETH now has less than 4.9% of its supply on exchanges for the first time in over 10 years, with 15.3 million fewer coins on trading platforms over the same timeframe.
A declining supply of a specific cryptocurrency on exchanges often indicates a reduced number of assets available for immediate sale, suggesting increased investor confidence.
Rising Demand for BTC and ETH
One way to gauge if the markets for BTC and ETH are experiencing increased demand is by examining inflows into their investment products. The U.S. spot Bitcoin ETF market has recorded positive flows on eight of the last ten trading days, with daily inflows reaching hundreds of millions of dollars. Spot Ethereum ETFs have also seen notable inflows during this period, albeit not as much as BTC.
Data from CoinShares’ Digital Asset Fund Flows Weekly Report indicates that digital asset investment products attracted positive flows for the fifth consecutive week, with Ethereum and Bitcoin funds recording substantial inflows.
Current Prices of BTC and ETH
As of the time of writing, BTC is trading at $105,290, while ETH is hovering around $2,527. The price increases may be linked to rising demand and decreasing supply.
The decline in BTC and ETH supply on crypto exchanges reflects growing investor optimism, which may influence price increases in the future.
