Should You Worry About Bitcoin Withdrawals On Exchanges? New Data Sheds Light
10 Mai 2023 - 5:00PM
NEWSBTC
Bitcoin holders have been paying attention to the amount of BTC
leaving crypto exchange platforms. Over the past week, the
cryptocurrency’s liquidity has been moving, raising concerns about
the stability of these venues and that marketmakers might be
exiting the space. Related Reading: Bitcoin Funding Rates On BitMEX
Turn Deep Red, Here’s Why This Is Bullish As the U.S. faces a
banking crisis, crypto exchanges crumble, and uncertainty in the
macroeconomic landscape increases, investors are vulnerable to
Fear, Uncertainty, and Doubt (FUD). A specific type of news and
narrative creates fear in the crypto market. Bitcoin itself was
negatively reacting to this news; as fear spiked, the price of BTC
took a turn for the downside. Despite today’s profits, the
cryptocurrency has recorded a 2.2% loss in the past seven days as
of this writing. Crypto Exchange Bleed Bitcoin? Data Clears The Air
Crypto analytics firm Jarvis Labs shared data from two sources
regarding the Bitcoin liquidity on exchanges to address these
concerns. The first piece of data comes from Conor Ryder, a
researcher at Kaiko, who claimed that Bitcoin’s market depth on
exchanges remains unchanged. The data is associated with Binance’s
U.S. subsidiary, where investors pay a premium to purchase BTC
compared to other platforms, such as Coinbase and Kraken. The
premium emerged due to Binance.US losing the capacity to provide an
efficient crypto-to-fiat offramp. The U.S. crypto exchange has been
suffering after losing its bank connection due to increased
scrutiny from the Securities and Exchange Commission (SEC). The
analyst stated the following while sharing the chart below: People
spotting a BTC premium on Binance US and seem to be jumping the gun
saying its a big market maker pulling funds. No change in market
depth on the exchange makes me nearly certain this isn’t the case
yet IMO more likely Binance US offering slower USD withdrawal times
after their struggles to get banked (…). The chart above shows that
BTC’s market depth has seen almost no changes since late April. The
rumors about marketmakers leaving the space began circulating due
to a Bloomberg report claiming that two of the largest, Jane Street
and Jump, are scaling back on their crypto trading operations. The
decision follows an increase in regulatory oversight, but it only
seems to apply to the U.S. market. According to Kaiko and liquidity
provider Macro Cephalopod, international crypto trading venues seem
unaffected. Here you go, average quoted size at bbo for Binance
BTCUSDT (in USDT) plotted with volatility, as you can see there is
almost no change since start of Apr, and the main determinant of
top of book size is vol (when vol goes up, MMs quote smaller, when
it drops MMs quote bigger) https://t.co/MtV5CcsfP5
pic.twitter.com/KTWCdZRsU5 — cephalopod (@macrocephalopod) May 10,
2023 Related Reading: Ripple CEO Rebuts WeBlogs Founder’s Claims
That XRP Is A Security In that sense, Bitcoin’s liquidity and
market depth is liquidity to change in the short term except for
U.S.-based crypto investors. The latter could find it more
difficult to gain exposure to the asset as the SEC and other
regulators enforce their approach to crypto companies. Cover image
from Unsplash, chart from Tradingview
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