Bitcoin, the world’s largest cryptocurrency, is undergoing a massive supply crisis as BTC whales transferred their funds from cryptocurrency exchanges to unknown wallets. BTC reserves at digital exchanges reached the lowest level in almost 2.5 years.
According to the latest data published by crypto research and analytics firm Bloqport, 211 new Bitcoin whale addresses with at least 1,000 BTC were created since the start of 2021, but the supply of the world’s largest digital asset decreased significantly during the same time.
Bitcoin price jumped above $40,000 on Saturday for the first time since 10 January 2021. As of writing, BTC is trading above $39,000 with a total market cap of $727 billion. BTC’s supply shortage is directly related to its price action.
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Finance Magnates earlier reported about a surge in anonymous crypto transactions involving the movement of large BTC amounts from leading cryptocurrency exchanges to anonymous wallets. A similar transaction was reported today as well when an unknown Bitcoin whale transferred 6,570 BTC worth more than $255 million to an unidentified wallet.
Gradual Bitcoin Supply Shortage
The number of Bitcoin addresses actively involved in transactions reached an all-time high of 22.3 million this month as the price of BTC jumped significantly. Despite all the activity on the BTC network, there has been a gradual BTC supply shortage on leading crypto exchanges triggered by BTC whales to drive the demand for the digital asset. Institutional demand for Bitcoin has been on the rise since the start of 2021. Leading wall street firms including companies like MicroStrategy accumulated BTC in large amounts. Grayscale, the world’s largest crypto asset manager purchased 42,356 BTC worth more than $1.6 billion in the last 30 days. The asset manager now has 649,000 BTC under management with a total worth of over $25 billion. The total value of Grayscale’s digital assets under management jumped above $30 billion for the first time after the recent rally in BTC and ETH.