Bitcoin Price Under Pressure: Investors Withdraw 196,000 BTC from Exchanges

Bitcoin Price Falls Below $90,000

The Bitcoin price fell below the $90,000 mark again on Sunday evening ^[2]. Bitcoin ended the past trading week with a loss of three percent, closing below $89,000 ^[1]. Despite the U.S. interest rate cut last Wednesday, the crypto market failed to sustain a northward trajectory and experienced renewed profit-taking in the second half of the week ^[1].

Other major cryptocurrencies also recorded losses: Ethereum lost nearly two percent but managed to hold above the $3,000 mark for now. Ripple and Solana each lost five percentage points in value despite continued inflows into spot ETFs ^[1].

Massive Outflows from Crypto Exchanges

At the same time, centralized crypto exchanges are facing sharply declining Bitcoin reserves. They last held as few coins as today in the fall of 2018 ^[2]. According to current on-chain data from analytics firm CryptoQuant, investors have withdrawn over 196,000 Bitcoin worth approximately $17.4 billion from Binance, Coinbase, Kraken, and other exchanges over the past three months ^[2].

This accelerates a trend that gained momentum in the spring of this year ^[2]. While exchanges held 2.952 million BTC on September 14, they currently hold only 2.755 million BTC ^[2]. This means that only 13.1 percent of all Bitcoin ever in existence now reside on crypto exchanges ^[2].

Bullish Signal or Structural Change?

At first glance, more and more cryptocurrency users are following the old cypherpunk principle "Not your keys, not your coins" ^[2]. A CryptoQuant post explained, referring to the Bitcoin decline at the world's largest crypto exchange Binance: "When the market rises, long-term investors and major holders move BTC from exchanges to cold wallets, reducing potential selling pressure." This pattern is typical of strong markets and reflects confidence rather than fear ^[2].

However, there is also an alternative explanation: The new crypto-friendly regulation in the United States is leading more established financial service providers to offer their own custody solutions ^[2]. At the same time, Bitcoin treasury companies like MicroStrategy and spot ETFs have accumulated hundreds of thousands of BTC since the beginning of the year, which are also held outside traditional exchanges ^[2].

Outlook for the Coming Trading Week

In the new trading week, important economic data will be the focus of investors' attention, which could move prices in the crypto market ^[1]. The crypto market is currently in a phase of uncertainty ^[1], which is why investors will be closely monitoring developments in the stock and crypto markets as well as various U.S. inflation data and the release of the major U.S. labor market report ^[1].