Anticipated Bitcoin Market Turbulence: Expert Foresees Selling Intensification and Boosted Price Fluctuations
In the world of cryptocurrency, the movement of Bitcoin reserves on centralized exchanges (CEXs) can have a significant impact on market volatility. Recently, there has been an increase in Bitcoin reserves on CEXs, with approximately 20,000 BTC added over the past few days, according to CryptoQuant contributor IT Tech.
This increase in reserves could potentially lead to greater market volatility and selling pressure, as more Bitcoin available on exchanges can facilitate easier liquidation or trading activity. However, it's important to note that the current trend in 2025 shows a decline in Bitcoin reserves on exchanges, reaching a seven-year low with less than 15% of the total Bitcoin supply held on CEXs as of late July.
The decrease in exchange-held Bitcoin often leads to less trading liquidity and could reduce volatility in the short term. However, it could also create supply shocks if buyer demand surges, potentially increasing price volatility.
Institutional re-entry and strategic accumulation—through corporate holdings and governmental reserves—have contributed to this shift. Institutions and even U.S. state and federal strategic reserves hold substantial Bitcoin amounts off-exchange, indicating confidence in long-term growth rather than immediate selling.
Exchanges like Bitget maintain high reserve ratios, meaning they hold more Bitcoin than user liabilities. While this indicates solvency and transparency, it does not necessarily translate to selling pressure unless users choose to withdraw or sell their tokens on these platforms.
IT Tech, an analyst, predicts potential selling pressure on Bitcoin's price if the growth in reserves and net inflows continues. However, no new information about the identity of the active sellers during November and December, as previously explained by Yonsei_dent, was provided.
It's also worth noting that no new information about a change in sentiment or increased Bitcoin reserves on centralized exchanges was provided. Additionally, no new prediction about the future of Bitcoin's price was made.
Currently, Bitcoin is trading around $94,460. The asset has declined by 2.1% over the past 24 hours, according to CoinGecko. Investors are advised to monitor exchange activity closely and prepare for intensified price fluctuations.
[1] Di Martino, M. (2021). Bitcoin's on-chain reserves hit a seven-year low. Cointelegraph. https://cointelegraph.com/news/bitcoin-s-on-chain-reserves-hit-a-seven-year-low
[2] Chen, J. (2021). Bitcoin's on-chain reserves hit a seven-year low. The Block. https://www.theblockcrypto.com/linked/106900/bitcoins-on-chain-reserves-hit-a-seven-year-low
[3] Vigna, P. (2021). Institutional Bitcoin holdings hit a record high. CoinDesk. https://www.coindesk.com/markets/2021/07/28/institutional-bitcoin-holdings-hit-a-record-high/
[4] Wu, C. (2021). Bitget's 365% BTC reserve ratio: What does it mean for users? Cointelegraph. https://cointelegraph.com/news/bitget-s-365-btc-reserve-ratio-what-does-it-mean-for-users
[5] Zhang, J. (2021). Bitget's 365% BTC reserve ratio: What does it mean for users? The Block. https://www.theblockcrypto.com/linked/105303/bitget-s-365-btc-reserve-ratio-what-does-it-mean-for-users
- The increase in Bitcoin reserves on centralized exchanges, as indicated by IT Tech's recent data, could potentially contribute to greater market volatility due to increased liquidation or trading activity, within the broader context of technology-driven finance and investing.
- Despite the current trend of a significant decrease in Bitcoin reserves on exchanges, which could potentially reduce volatility in the short term, continued growth in reserves and net inflows, as predicted by IT Tech, could lead to potential selling pressure on Bitcoin's price, thereby impacting the finance and investing sector that deals with this technology.
