- Bitcoin deposit addresses on exchanges averaged 180,000 annually before 2021 but now average around 48,000 over 30 days, reflecting a persistent shift.
- Spot Bitcoin ETFs have drawn investors, reducing direct exchange deposits and encouraging price exposure through regulated investment vehicles without custody risks effectively.
- Long-term holding dominates as investors treat Bitcoin as savings or treasury reserve, lowering daily deposit activity and supporting reduced exchange interactions consistently.
The behavior of bitcoin investors has changed significantly at the end of 2021 market cycle, so much so that you continue to see a leaked decline of Bitcoin deposits into exchanges from bitcoin investors on chain. This indicates a growing long-term strategy among bitcoin investors and affects the way bitcoin will be used in the overall market.
Exchange Deposit Activity Declines Sharply
A chart shared by Darkfost_Coc using CryptoQuant data shows a marked decline in the number of addresses depositing Bitcoin on exchanges. Between 2015 and 2021, deposit activity steadily increased, peaking at an average of 180,000 addresses annually. That trend reversed after 2021 and has yet to recover.
The 30-day moving average at press time is 48,000 while the daily number has whittled down to just 37,000. The 10-year average has hovered around 90,000 – so activity is still significantly below historical norms. This data indicates a behavioral shift to engaging in fewer trading events and moving to a hold position versus trading position.
This reduction in deposit activity is not associated with lower adoption but instead suggests a maturing investor base. The drop coincides with growing use of alternative investment channels and changing market conditions.
ETFs Provide Price Exposure Without Custody Risks
The launch of spot Bitcoin ETFs is primarily driving this trend. These products allow investors to invest in Bitcoin price exposure via financial tools without dealing with private key management or exchanges. Some investors who are now making greater use of these tools are preferring to have Bitcoin exposure through traditional investment vehicles.
The accessibility of ETFs is attracting new capital from institutional investors and asset managers. These channels reduce reliance on exchanges, directly lowering the number of deposit addresses. The shift toward ETF-based exposure is likely to continue as market infrastructure evolves.
Retail activity has also remained subdued during the current cycle, which naturally lowers the number of small traders depositing BTC for spot trading. The current market structure is favoring fewer but larger players who hold longer positions.
Long-Term Holding Replaces Active Trading
CryptoQuant data shows a clear rise in holding behavior among Bitcoin users. A great number of people and organizations are now considering Bitcoin to be utilized as a long-term savings vehicle. This purpose is aligning with the ongoing use of BTC in treasury reserves and long term financial considerations.
As people accept Bitcoin as a store of value, less frequent deposits to exchanges have occurred. Long-term holding diminishes the amount of interaction with exchanges, resulting in decreasing address activity.
These changing trends signify an evolving transition of Bitcoin from a speculative asset to a fundamental financial instrument in investor even as the data indicates a gradual but still ongoing shift in the perspective of BTC across the whole spectrum of the market.
