Bitcoin Deposits Hit Rock Bottom: ETFs and Diamond Hands Dominate the Market
Bitcoin's on-chain activity just flatlined—and Wall Street's new crypto toys might be to blame.
HODL mode activated
Exchange deposits cratered to unprecedented lows this week as investors shifted strategies. The numbers don't lie: everyone's either parking BTC in ETFs or locking it up cold storage like digital preppers.
The great institutional land grab
BlackRock and friends didn't launch those spot ETFs for charity. Now they're vacuuming up supply while retail traders nap on their private keys. Classic Wall Street—turning volatility into management fees since forever.
Meanwhile, Bitcoin's original promise—peer-to-peer electronic cash—keeps getting buried under layers of financialization. But hey, at least your 401(k) can now lose value in exciting new ways.
Bitcoin Deposit Address Activity Plunges To Historic Lows
According to a recent CryptoQuant Quicktake post by on-chain contributor Darkfost, there has been a noticeable shift in the number of BTC wallet addresses depositing to exchanges since the 2021 bull cycle.
The analyst shared the following chart to support their analysis. It shows a steady increase in the number of addresses depositing BTC on exchanges between 2015 and 2021, peaking at an annual average of approximately 180,000.
However, this trend has sharply reversed since then and has shown no signs of recovery. Notably, the 10-year average for the number of addresses depositing BTC to exchanges currently sits around 90,000.
Shorter-term metrics reinforce this decline. The 30-day moving average (MA) is hovering around 48,000, while the daily figure has dropped to just 37,000. This drastic behavioral shift among investors can be attributed to two key factors.
First, the emergence of BTC exchange-traded funds (ETFs) has redirected a significant portion of demand away from spot exchanges. ETFs allow exposure to Bitcoin’s price performance without the complexity or risk of self-custody.
Second, retail participation has been relatively subdued in the current market cycle, naturally reducing the number of active deposit addresses.The analyst noted:
More investors, and now even companies, are adopting a long-term vision for BTC, choosing to hold it as savings or treasury reserves rather than actively trading it.
Is BTC Preparing For A New High?
As the number of addresses depositing BTC to exchanges continues to decline, several indicators point toward the potential for a new all-time high (ATH). Recent analysis by crypto analyst CryptoGoos suggests that short-term sellers are “getting exhausted,” implying that selling pressure may ease soon.
Similarly, the bitcoin Rainbow Chart – a long-term valuation model used to identify overvaluation and undervaluation zones – recently flashed a “buy” signal. Although, the wider market demand remains weak.
Macroeconomic conditions are also turning favorable. An increase in the global M2 money supply is expected to benefit risk-on assets like Bitcoin. Some experts now predict BTC could rise as high as $150,000 as liquidity expands.
That said, not all signs are bullish. Miner-to-exchange transfers have recently spiked to historic highs, potentially signalling increased selling pressure from BTC miners. At press time, BTC is trading at $105,141, up 2.6% in the past 24 hours.
