Goldman Sachs reports that the supply of Bitcoin and Ether on exchanges decreased in June.

The supply of bitcoin (BTC) and ether (ETH) on exchanges declined in June due to increased regulations and concerns about crime, leading holders to prefer self-custody, according to a report from Goldman Sachs. The report, which cites on-chain data, states that the supply of bitcoin, the largest cryptocurrency by market capitalization, dropped by 4%, approaching levels not seen since December 2022, which was the lowest since November 2020 – just before the beginning of the bull market in 2021. The supply of ether also decreased by 5.8%, reaching levels not seen since May 2018.

Goldman Sachs points out several factors contributing to this trend. First, major centralized spot exchanges are facing regulatory challenges, causing investors to be cautious. Additionally, concerns about cyber hacks and theft in the crypto markets are prompting asset holders to prefer self-custody. This aligns with the saying “not your keys, not your coins.” Specifically for ether, the ability to withdraw staked ether has resulted in investors choosing to stake their ether rather than passively holding it on exchanges.

The report highlights that June was a record month for bitcoin miners’ inventory sales, as miners took advantage of the cryptocurrency’s strong performance. Total monthly BTC inflows from miners to exchanges nearly doubled from May to $99 million, and the bitcoin price increased by almost 12% according to TradingView data.

In June, as transaction fees returned to normal following the network congestion experienced in May, the monthly address activity for bitcoin and ether rebounded, increasing by 15.5% and 37.5% respectively. Goldman Sachs also noted a 65.1% decrease in average daily ether burnt and a 63.3% drop in average daily fees compared to the previous month.

The report also mentions an increase in new on-chain activity in June. The daily average new address count for bitcoin and ether rose by 9.8% and 48.2% respectively compared to the previous month.

For more information, read the article “Bitcoin Saw Heavy Profit Taking in May: Goldman Sachs.”

Edited by Sheldon Reback.