Data from CryptoQuant indicates that the OTC bitcoin balance has surged to 410,000 tokens, the highest since May 2022. This increase in balance reflects strong liquidity, which allows trading desks to execute large trades without affecting market prices. High balances can suggest heightened activity among high-net-worth individuals and institutions opting for OTC trades, emphasizing a strategic choice to mitigate price volatility that typically accompanies traditional exchange trading.
The recent uptick in OTC bitcoin balances, mirroring the late 2020 to early 2021 bull run, finds itself juxtaposed against a price decline. Currently, while balances have more than doubled from March's 185,000 tokens, bitcoin's price trajectory remains downward from its all-time high above $73,500. For the anticipated 'Uptober' rally to gain momentum, a reduction in OTC balances may be essential to provide the liquidity needed for large trades that can stabilize prices.
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