In the final weeks of 2024, the daily number of BTC deposits to exchanges fell to 30,000. CryptoQuant analyst Alex Adler Jr. believes this could signal an upcoming rally for Bitcoin.

Current levels are three times lower than the 10-year average of 90,000. According to Adler Jr., the peak in this cycle reached 125,000 deposits per day.

The analyst noted that a decrease in Bitcoin transfers to exchanges indicates that users prefer to store their BTC in personal wallets rather than preparing to sell. He suggested that such a low level of deposits might lead to a Bitcoin shortage in the spot market, a trend previously observed before major Bitcoin rallies.

Another potential indicator of a rally is the ratio of total BTC inflows to the overall reserves held by exchanges.

Adler Jr. added that the lowest levels of this metric were typically seen at the end of bear markets, when experienced investors actively bought coins from distressed sellers at around $17,000.

The analyst concluded that the current decline in deposits and the inflow-to-reserves ratio signals the potential for more significant price movements.

Earlier in December, analysts warned about a possible deeper Bitcoin price correction before reaching a new all-time high.