The supply of bitcoin (BTC) on centralized crypto exchanges has fallen to its lowest level in six years, indicating a decline in selling intent.

According to the latest edition of the Bitfinex Alpha report, exchange-held BTC has reached its 45th consecutive month of diminishing supply. The development came when BTC hit a significant resistance level at $45,000.

Bitcoin Supply on Exchanges Continue to Decline

Long-term investors or large holders usually move their assets to crypto exchanges with the intention of selling and withdraw their balances from such platforms to store them in cold wallets for extended periods.

The decline in BTC supply on exchange is considered a bullish sign because it shows an increased desire by investors to continue holding their assets and a decrease in intentions to sell them. The reduction also indicates a potential shift toward decentralized and self-custody solutions.

As the reduction in exchange-held BTC has persisted since 2017, it has significantly impacted the asset’s volatility, liquidity, and overall market dynamics. The implication extends to BTC deposit transactions to exchanges, which have plunged to multi-year lows. Current deposits to exchanges have declined to a level last seen in July 2020, suggesting reduced selling pressure.

BTC Hits $45K Resistance

While BTC deposit transactions decline alongside the asset’s supply on exchanges, the network’s Spent Output Profit Ratio shows that a large portion of holders are currently in profit, as the metric has remained above one for 44 consecutive days.

Bitcoin’s latest surge saw the asset surpass $44,000, representing a 170% increase from the start of the year. However, the leading crypto asset hit a resistance level at $45,000 and came tumbling down. Data from CoinMarketCap shows BTC was tradin