Data from Glassnode reveals that Bitcoin supply has observed a shift from wallets based in America to those in Asia recently.
Bitcoin Supplies Held By Asian and US Investors Face Ways Recently
According to data from an on-chain analytics firm Glassnodean interesting dichotomy has formed between various regional cryptocurrency supplies recently.
Glassnode divides Bitcoin addresses into different regions based on the times they make transactions. An “entity” here refers to one or more wallets under the control of an investor (or a group of investors).
“The timestamps of all transactions performed by an entity are correlated with the working hours of different geographic regions to determine the trends for each entity located in the US, Europe, or Asia,” explained the analytics company.
The three main regions are the US (13:00 to 01:00 UTC), Europe (07:00 to 19:00 UTC), and Asia (00:00 to 12:00 UTC). In the context of the current discussion, however, only the US- and Asia-based supplies are relevant.
Here is a chart showing the trend of year-over-year supply changes in these two regional Bitcoin supplies over the past few years:
Looks like the values of the two metrics have been going exactly the opposite directions in recent months | Source: Glassnode on Twitter
As shown in the above graph, the supply of Bitcoin held by US investors grew faster and faster in the lead up to and during the bull period in the first half of 2021 while the year-over-year change -o always increased.
The change slowed in the second half of the year, but remained positive, suggesting that supply continued to grow, albeit at a slower pace. In 2022, however, supply began to decline, as the bear market took over and LUNA and 3AC crashed.
The year-over-year change in US-based BTC supply has continued to grow more negatively since then and now stands at -7.5%, suggesting that supply has decreased by 7.5% since May 2022.
The supply of Asian Bitcoin, however, showed a very different behavior, because it began to rise just as American investors began to shed their assets.
Interestingly, the pace of change in supply held by Asian traders is almost the same as that seen in the balances of US-based wallets (although, of course, the change is in the opposite direction).
Currently, the year-on-year supply change in Asia is at +6.9%. The fact that Asian investors bought a similar amount to what US owners sold suggests a direct transfer of coins between the two supplies.
Now, as to why this continuous shift in supply is happening, the main reason is the fact that the US has tightened regulations related to the cryptocurrency sector recently.
One of the most prominent examples of this is the regulatory crackdown observed on Coinbase from the Securities and Exchange Commission (SEC) recently.
At the time of writing, Bitcoin is trading at around $28,200, down 1% from last week.
BTC has surged in the past day | Source: BTCUSD on TradingView
Featured image from iStock.com, charts from TradingView.com, Glassnode.com