According to Bank of America Corp’s astute strategists, the remarkable surge of Bitcoin in 2023 may persist if we consider the transfers between cryptocurrency exchanges and individual digital wallets, as per Bloomberg’s report.
A recent report by strategists Alkesh Shah and Andrew Moss revealed that the week ending on April 4 saw a significant net outflow of Bitcoin from crypto exchanges – the second-largest amount this year. Furthermore, $368 million worth of Bitcoin was transferred to personal wallets during the same period. These findings suggest a growing trend of investors seeking to hold onto their Bitcoin assets, indicating a shift towards long-term investment strategies.
The strategists further added:
Investors transfer tokens from exchange wallets to their personal wallets when they intend to hold them (or HODL), indicating a potential decrease in sell pressure.
In a recent note published Monday, Bank of America strategists shed light on the recent exodus from crypto exchanges. According to them, the regulatory crackdown on digital-asset platforms in the US has caused concerns among investors, leading to this trend. Bitcoin’s remarkable surge this year has outperformed major asset classes, sparking a heated debate about the reasons behind its recovery from the 2022 slump.
Bitcoin has made a remarkable comeback, soaring above the $30,000 mark this week, a feat it hasn’t achieved since June 2022. The cryptocurrency’s value has skyrocketed by more than 80% since December 31, outpacing the Nasdaq 100 tech index, which recorded a modest gain of 19%. In contrast, gold has only experienced a meager increase of approximately 9%. Bitcoin’s impressive performance has caught investors’ attention worldwide, highlighting its potential as a lucrative investment option.
Despite the challenges faced by FTX and other crypto firms and the regulatory crackdown by US authorities, digital tokens have witnessed a remarkable surge in value in 2023. However, this rally has taken place in a market that has witnessed a decline in liquidity and trading volumes, primarily due to the bankruptcies of these companies.
