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Bitcoin (BTC) leak: Nothing to fear… for now!

Fri 12 May 2023 ▪ 3 min of reading ▪ by Mikaia A.
Getting informed Invest

Crypto exchange crashes like FTX have always been preceded by massive currency transfers. However, some observers claim that large volumes of Bitcoin have been leaving exchanges such as Binance recently. Is this the beginning of the end for this giant and its peers?

Bitcoin coins

Bitcoin is leaving exchanges

Is it time to abandon ship on Binance? That’s a question some observers are asking themselves right now. The investigation by US regulators into its compliance, the crackdown that will follow, and many other reasons are causing them to question the solidity of CZ’s exchange.

NewsBTC has just added another crucial point: the increase in the number of bitcoins leaving cryptocurrency exchanges. This phenomenon was observed in the sector last week.

This is enough to raise doubts, which investors call “Fear, Uncertainty, and Doubt (FUD).”

Jarvis Labs’ explanations

Seemingly a lot of FUD lately about liquidity in exchanges, market makers leaving the ecosystem, etc. Kaiko’s team covers it well, putting rest to few conspiracies. (Although it was apparently true that Jump and Jane were pulling out of any US crypto exchange operations).

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, BTC quicker withdrawals + surging demand = premium

Twitter

Reassuring words

Looking at Conor Ryder’s chart, you’ll find data on Binance.US. This Binance subsidiary is currently struggling. The reason: it is no longer able to provide an efficient access ramp for cryptocurrencies after the SEC decided to attack it. As a result, investors are not hesitating to offer a premium to promote the purchase of BTC. This doesn’t exist on other platforms.

But it’s far from enough to impact the liquidity and depth of the Bitcoin market. At least not in the short term.

The case of Jane Street Group and Jump Crypto, which had to slow down their activities, could also worry some. According to them, the regulatory uncertainty surrounding the cryptocurrency sector is not motivating.

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Mikaia A. avatar
Mikaia A.

La révolution blockchain et crypto est en marche ! Et le jour où les impacts se feront ressentir sur l’économie la plus vulnérable de ce Monde, contre toute espérance, je dirai que j’y étais pour quelque chose

DISCLAIMER

The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.