Today, Bitcoin is trading just below $39,000, which is still noticeably lower from the cryptocurrency’s all-time record of $69,000. The cryptocurrency made it back above $45,000 in early March, but ended up going back lower. Here is a daily chart of BTC, which includes the first coin’s high.

Bitcoin daily rate chart

What’s going to happen to the Bitcoin exchange rate?

The first reason for optimism is that Bitcoin’s chart has approached a strong support level on a large scale. Historically, such technical analysis figures have worked well before with the subsequent rise in the asset.

As a reminder, all such terms only describe investor behaviour. In this case "strong support level" means that capital owners have previously bought a lot of coins at about the same rate. In this case, the most logical action for them to take is to increase their cryptocurrency savings at the entry level, as this scenario leaves the position opening level unchanged. Correspondingly, if the blockchain project's fundamental advantages remain the same, investors get a chance at the same scale of growth, but with a larger amount invested.

Bitcoin chart

The second reason lies in the activity of “whales” – that is, big investors, Cointelegraph journalists note. According to the CoinMetrics platform, big investors continue to actively buy up BTC. The number of Bitcoin addresses holding at least 1,000 BTC increased from 2,127 to 2,266 in just a few days. In the same period, the price of BTC rose from $38,000 to $45,000.


This means that Bitcoin continues to be a popular investment among holders of large amounts of cryptocurrencies. At the same time, so-called whales are more likely to hold free funds, which they allocate to open positions when the market collapses. And this usually helps the latter to recover lost positions.

Dynamics of the number of Bitcoin addresses with 1000+ BTC in their accounts

Finally, the third reason is the continuing outflow of cryptocurrency from exchanges. Coins have been actively withdrawn by users of trading platforms since October 2021, which is six months in a row. This suggests that bitcoins are not willing to be sold, but instead are being relied on for long-term storage in cold wallets. In addition, this significantly reduces sellers’ pressure on the market.

Dynamics of crypto reserves on exchanges

In general, the number of BTC on exchanges will continue to decline further. Crypto exchanges currently hold less than 2.4 million BTC, which is the lowest number since September 2018. So far, in this environment, the market looks like a “compressed spring” that is ready to unwind at any moment. However, this requires not only the right conditions, but also the absence of critical obstacles, the role of which at the moment is played by the geopolitical conflict in Ukraine. Obviously, investors are unlikely to risk all their capital in such an uncertain environment.

By way of analogy, we are reminded of March 2020, when Bitcoin experienced a sharp drop to the $4,000-5,000 level amid the popularization of the coronavirus. Although it took months to recover, BTC was eventually able to surpass its previous high from December 2017 by more than three times. With that in mind, there is a chance that investors will not forget this feature of the digital asset's behaviour and will contact BTC again.

Bitcoin and the coronavirus


We think that predicting Bitcoin's situation is quite difficult, as the world hasn't been in such serious uncertainty for a long time. However, the first cryptocurrency has previously coped with crises over a long period of time and regularly set new price records. We want to believe that 2022 and subsequent developments will be no exception in the history of blockchain-based digital assets.

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