The “bad sentiment” surrounding bitcoin dominated the trend for several weeks as its price mostly remained below the $28,000 level.
However, recent data has been bullish for the world’s largest crypto asset, indicating it could potentially be on the cusp of a bullish breakout.
bitcoin is at the bottom
Bitcoin’s tight-range consolidation may finally be coming to an end. Glassnode co-founder Negantropic, for one, believes that the bottom is near for the crypto asset and it is only a matter of time before the price “takes off”.
According to his analysis, the bears are getting exhausted after several failed attempts to break below the 200SMA, a level he considers “solid support.” With the bullish crossover of the 50SMA to the 200SMA, bitcoin is expected to turn the narrative in its favor soon.
#bitcoin is at the bottom
The bears are getting exhausted after several failed attempts to break below the 200SMA, which is a solid support.
— (@Negentropic_) May 22, 2023
The development comes just days after the analytical firm noted that the confidence of existing bitcoin holders remained “remarkably high” even as the market witnessed extreme volatility and extreme declines over the past two years.
sense as well saw That investors are moving their bitcoins from crypto exchanges to cold storage wallets. While the current supply going into self-custody is not a perfect indicator, the crypto analytical firm said that the decreasing volume of BTC on exchanges generally indicates a future bull run.
Therefore, a high accumulation trend against a background of arguably low inflow of new demand and stability indicates that investors view the current market condition as an opportunity to acquire greater shares of assets.
Trust in custodians at an all-time low
Bitcoin holders have lost faith in centralized crypto exchanges, a trend that can be corroborated by the fact that the supply held on exchanges has dropped to 5.84% – representing the lowest level in the last five and a half years.
The shift from custodian to self-custody system gained traction in early 2022 and continued throughout the year. The decline became even more apparent after the collapse of crypto giant FTX Group led by Sam Bankman-Fried, after which the amount of BTC sitting on the centralized platform dropped below 7%.
Binance has also seen an increase in bitcoin outflows over the past few months, indicating that many users are leaning towards self-custody rather than third-party custodians.
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