What happens when Exchanges run out of Bitcoin?
Exchanges are bleeding BTC every week, that can't last forever....
Right now exchanges, basically across the board are losing bitcoin just about every week.
The total balance on exchanges has been in steady decline for roughly the last 12 months.
It hasn't shown any signs of reversing course, and is accelerating on some exchanges.
Take Coinbase for example, which will have no bitcoin left 454 days from now if it keeps losing bitcoin at this pace.
The really neat takeaway from all this?
If go back in time and look at the 2017 bull market we can see that there was a similar stretch where the supply on exchanges was soaked up for a stretch.
Check it out:
There was roughly a 6 month stretch where the balance on exchanges continued to drop before starting to go up again.
The price of bitcoin went on to rally for 12 months after this change balance on exchanges happened.
Even more important, the price went up 20x after this supply shock!
While I don't think it will play out in this fashion it could do something similar.
We are already double the length of time that the balance on exchanges had been dropping for.
I suspect that when this starts changing it will signal we are within a year of a top, possibly a lot closer.
Either way though, selling any BTC while the balance on exchanges continues to fall seems like a really foolish idea to me.
Stay informed my friends.