Bitcoin's Liquid Supply Plummets by 50% in Three Months, Signaling Reduced Trading Activity

On-chain data reveals a significant drop in Bitcoin's Hot Supply, decreasing by over 50% in the last three months, from 5.9% to 2.8%. This decline, as reported by Glassnode, indicates a sharp reduction in liquid BTC available for trade. The Bitcoin Exchange Inflow has also decreased, from 58,600 BTC per day during the rally to 26,900 BTC per day currently, suggesting reduced sell-side activity and weaker demand. Furthermore, the Bitcoin Futures Open Interest has fallen by 35% since the all-time high, from $57 billion to $37 billion, mirroring the contraction in on-chain liquidity and pointing to broader risk-off behavior. Bitcoin recovered above $87,000 yesterday, but it seems the coin has seen another setback as it's now back at $85,000.