Recent on-chain data indicates that platforms based in the US have been increasing their Bitcoin reserves. Here’s the potential impact this could have on BTC’s price.
Bitcoin US to The Rest Reserve Ratio Has Recently Increased
According to a new post by Ki Young Ju, the founder and CEO of CryptoQuant, there appears to be a trend of Bitcoin moving from international exchanges to American platforms.
The key on-chain metric to consider is the “US to The Rest Reserve Ratio,” which measures the amount of Bitcoin that US-based central entities, such as exchanges and funds, hold compared to those owned by platforms globally.
An increase in this ratio indicates that the cryptocurrency is flowing to US-based entities from other countries, while a decrease suggests the rising prominence of platforms outside the US.
Below is a chart illustrating the trend of the Bitcoin US to The Rest Reserve Ratio over the last ten years:
The metric seems to have been on an upward trend in recent months | Source: @ki_young_ju on X
As shown in the chart, the Bitcoin US to The Rest Reserve Ratio experienced a significant drop during the bear market of 2022, reaching a low in 2023. This suggests a considerable shift in BTC supply, with tokens migrating to wallets associated with offshore exchanges.
However, in 2024, this indicator seems to have reversed direction, trending upwards, which indicates that US platforms are regaining some of their previously lost influence.
The main contributor to this trend is clear: spot exchange-traded funds (ETFs). These ETFs provide a way for traditional investors to gain exposure to Bitcoin’s price movements.
Earlier this year, these funds received approval from the US Securities and Exchange Commission (SEC) and have started to gain traction since then.
As the US to The Rest Reserve Ratio now includes these new funds in its calculations, it’s natural for its value to increase following their introduction this year.
What could this upward trend signify for Bitcoin? The chart reveals that the previous two times BTC experienced a notable upsurge in this indicator coincided with significant bull markets.
The rally that led to the all-time high (ATH) earlier this year also saw a swift increase in the metric, although the scale was less dramatic compared to the lead-up to the 2017 and 2021 bull markets.
Based on historical patterns, it’s plausible that Bitcoin may also reap benefits from this current supply shift towards American exchanges.
BTC Price
After maintaining its bullish momentum throughout the last day, Bitcoin has successfully regained the $65,000 level.
The coin's price has been trending upwards for some time now | Source: BTCUSDT on TradingView
Image sourced from Dall-E, with data from CryptoQuant.com and chart from TradingView.com
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