Here’s Why Bitcoin’s Rally Is Far From Over As BTC Crosses $91,000

Bitcoin experienced a short-term pullback at the end of the work week, briefly dipping below $87,000 after hitting its latest all-time high of nearly $94,000 on Wednesday.

However, the worst could happen as the asset has recovered most of the losses and is currently above $91,000. At the same time, factors have emerged in the chain that suggest its rally still has plenty of legs and could eventually challenge the coveted $100,000 level.

BTC on exchanges decrease

One of the metrics used to determine the immediate selling pressure of a given cryptocurrency is its availability to sell in a hurry, which is evident from the reserves on the exchanges. Essentially, the lower the amount found on trading platforms, the less immediate selling pressure there is for the underlying asset.

In this scenario, investors are withdrawing their funds, usually into cold storage devices, in preparation for the continuation of the ongoing trend.

CryptoQuant data shows that BTC reserves on exchanges have continued to decline recently, especially since Donald Trump won the 24th US presidential election last week. In fact, bitcoin reserves have fallen to a six-year low of less than 2.6 million.

Bitcoin reserves on exchanges. CryptoQuant

“This move reduces the supply available for immediate sale, creating buying pressure in a tight supply environment. As a result, the market may see a trend toward Bitcoin appreciation, especially if demand remains stable or grows. – read his analysis.

The report also indicated that these withdrawals from exchanges solidify investors’ view that bitcoin serves as a “store of value in a global economic context of uncertainty and high inflation.”

The removal of BTC from trading platforms could lead to a “more volatile but more resilient” BTC market, with less selling pressure and “increasing dominance of long-term holders, which could open up space for new peaks in prices”.

Stablecoins on the Rise

Market liquidity has improved in recent weeks, again, especially after Trump’s victory, which is another factor that could suggest further price gains for the crypto market. At the end of the day, stablecoins provide an easy and simple way for investors to enter the market and allocate funds to bitcoins and altcoins.

CryptoQuant’s dashboard shows that just over $3 billion in USDT has flowed into crypto exchanges since the election, which is the highest in three years. The chart below shows how the larger number of stablecoins in existence and on trading platforms coincides with BTC price rises.

Stablecoin reserves and BTC prices. Source: CryptoQuant SPECIAL OFFER (Sponsored) Binance Free $600 (CryptoPotato Exclusive): Use this link to register a new account and receive an exclusive welcome offer of $600 to Binance (full details).

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