Bitcoin On-Chain Data Signals BTC Price Nears Next Bull Run

Bitcoin reserves on crypto exchanges have been steadily declining, a trend that market analysts often associate with a potential upward movement in the asset’s price. As more investors move their Bitcoin holdings from exchanges to cold storage, the available supply in the open market decreases. Historically, such movements in Bitcoin reserves have been linked to subsequent price rallies, raising expectations for a similar scenario in the near future.

Bitcoin Reserves Decline Amid CPI Impact on BTC Price

According to data from CryptoQuant, a leading blockchain analytics firm, Bitcoin reserves on exchanges have been shrinking over the past few months. This trend points to a reduction in selling pressure as more investors move their assets into cold storage, making them unavailable for immediate trading.

Meanwhile, Stablecoin reserves on exchanges are climbing. Stablecoin balances represent readily available capital for investors looking to make purchases at the right time. The growing amount of crypto-backed currency on exchanges suggests that traders are preparing to deploy this capital once market conditions seem favorable.

Concurrently, newly released US Consumer Price Index (CPI) data revealed that inflation eased to 2.5% in August, falling short of market predictions. This closely watched inflation figure is a key factor that the US Federal Reserve considers when determining its future policy rate decisions.

Despite a slight pullback today, analyst Van de Poppe views this as a normal correction before CPI is revealed. He anticipated a rally if Bitcoin holds its ground around the $55K to $56K.

Analysts had forecasted that the CPI m/m will remain unchanged at 0.2%, while the CPI y/y was predicted at 2.5%. This is slightly lower than last month’s 2.9%. Van de Poppe took to X platform after the CPI data reveal suggesting that Bitcoin is holding up nicely. He expressed confidence stating,

“There we go, retest of the crucial area and #Bitcoin is holding up nicely. A breakout above $57K indicates a strong solid continuation at $60-61K.”

Supply-Demand Imbalance Amid $100K Price Prediction

The combination of decreasing Bitcoin reserves and rising Stablecoin reserves creates an imbalance between supply and demand. With fewer Bitcoin tokens available for sale and more buying power accumulating, market dynamics could favor an upward movement. Historically, this type of supply-demand imbalance has been followed by sharp price increases.

Additionally, the convergence of multiple factors suggests that Bitcoin price could reach $100K. The Mars-Vesta cycle, which accurately predicts market tops and bottoms, points to a peak around October 2025. 

At the same time, rising interest in Bitcoin from institutional investors, spurred by the approval and analysts optimistic outlook of spot Bitcoin ETFs, is adding to the bullish sentiment. Key macroeconomic events, such as the U.S. Federal Reserve’s anticipated rate cut could further influence market volatility. 

With Bitcoin’s four-year cycle aligning with historical trends, analysts agree that BTC could surpass $100K between late 2024 and 2026.

According to CoinGape Bitcoin price prediction, September could see BTC price rally 24.8% to $68,432.7 by the end of the month. More so, the analysis predicts BTC could break its current all time high by mid 2025.

At the time of writing, BTC price is $57,559, reflecting a slight decrease of 0.31% over the last 24 hours.