When comparing the current selloff to the May collapse, Bitcoin on-chain data indicates that the exchange reserve indicator differs.
The Bitcoin all exchanges reserve is a metric that displays the number of bitcoin stored in the wallets of all centralized spot exchanges.
When the reserve value rises, it indicates that more investors are moving their BTC to exchanges for withdrawal to fiat or altcoin purchase.
Similarly, a downward trend in the measure indicates that investors are removing a net quantity of Bitcoin from exchange wallets and storing it in personal wallets or selling it through OTC agreements.
Examining the graph above, various intriguing characteristics may be noticed. The exchange reserve was falling from a very high value in the build-up to the 2021 bull run.
This stands to reason because a slump indicates that investors were acquiring more coins, which may help drive up prices.
Then, about the time Bitcoin reached its all-time high (ATH), the measure began rapidly rising back up, suggesting a selloff, and the price fell in reaction.
At the time of writing, the price of Bitcoin is about $46,302, down 8% in the past seven days.
Bitcoin’s price action was utter mayhem two days ago, with the coin’s value plummeting from $50,000 to $43,000 in fifteen minutes. Then, just a few minutes later, BTC was back above $47k.
Bitcoin fell to $44.4k yesterday, but it is currently back up to $46k. It’s difficult to predict where the price will go next, but one thing is certain: more turbulence is on the way.