On-chain data shows US-based platforms have recently increased Bitcoin holdings. Here’s what this could mean for the price of BTC.
The Bitcoin US To the Rest Reserve Ratio has been Increasing recently
As explained by CryptoQuant founder and CEO Ki Young Ju in a new post on X, BTC seems to be moving from other countries to US exchanges recently.
The on-chain metric of interest here is the “US to The Rest Reserve Ratio,” which tracks the ratio between the total amount of Bitcoin in US-based central organizations such as exchanges and managed funds and platforms in the country. the whole world is owned.
If the value of this metric increases, it means that the cryptocurrency is moving to US-based platforms from global ones. On the other hand, registering a decline suggests that the dominance of global platforms is increasing.
Now, here is a chart showing the trend of the Bitcoin US to The Rest Reserve Ratio over the past ten years:
The value of the metric appears to have been riding an uptrend in recent months | Source: @ki_young_ju on X
As shown in the graph above, the Bitcoin US to The Rest Reserve Ratio saw a steep decline during the bear market of 2022 and further declines in 2023. This would suggest that a major change in BTC supply has occurred, and tokens. to wallets attached to offshore platforms.
This year 2024, however, the index seems to have finally seen a change, as its value has been rising, which means that the American platforms have regained some of their lost dominance.
The main reason for this trend is simple: exchange-traded funds (ETFs). Existing ETFs are financial instruments that provide exposure to Bitcoin price movements in a way familiar to traditional investors.
These funds finally received approval from the US Securities and Exchange Commission (SEC) earlier this year and have gained some popularity.
The US to The Rest Reserve Ratio naturally includes these new currencies in its calculation and since they were not there before, it is logical that their value will register an increase after their arrival this year.
Now, what would this rise mean for Bitcoin, if anything? From the chart, it can be seen that the last two times that BTC saw significant upside in the headline happened to coincide with the last two bull runs.
The rally to the price all-time high (ATH) at the beginning of the year, too, saw a rapid rise in the index, although its scale was much smaller than the growth seen in the lead-up to the 2017 and 2021 bull runs.
Given the past, it is possible that Bitcoin may benefit from this change in supply in the American exchange as well.
BTC price
After seeing a recent bullish continuation over the past day, Bitcoin has finally bounced back above the $65,000 level.
Looks like the price of the coin has been on the rise for a while now | Source: BTCUSDT on TradingView
Featured image from Dall-E, CryptoQuant.com, chart from TradingView.com