CEXes: 200,000 BTC And More Than 1,000,000 ETH Left
CEXes growing confidence issue between exchanges and their users, investors are swiftly liquidating the majority of their holdings on trading platforms and moving their money to cold storage or hot wallets.
This process is known as the big migration of cryptocurrencies off of exchanges.
After the collapse of FTX, cryptocurrency exchanges have been in a real crisis as investors scramble to find solutions to protect their holdings. Unprecedented volumes of Bitcoin, Ethereum, and other top-tier cryptocurrencies are exiting centralized trading platforms. Up until the end of the year, the trend might.
On-chain data shows that more than 1 million ETH and almost 200,000 BTC worth $3.4 billion departed various centralized cryptocurrency trading platforms, marking the largest outflow of assets from CEXes since 2021. Such a tendency can mean a lot of different things.
First off, a declining trend in open interest and a general selling pressure on the market are frequently correlated with a declining volume of assets on exchanges. Compared to investors who save their money on exchange wallets, traders have a tendency to cling onto their money for longer once they remove it from the open market.
How will this impact the market?
If the trend continues, the volatility will decrease along with the selling pressure we saw in November. The withdrawal of capital from exchanges typically marks the beginning of an accumulation phase, which happens just before the market as a whole recovers.
Even without the rebound on trading exchanges, the bitcoin market recovery is still feasible despite the macroeconomic sector’s downturn. But it can be challenging to make projections and establish deadlines, particularly as the year comes to a close.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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