This is a direct result of the collapse of the FTX empire. To protect their interests, many investors take their assets off the platforms to store them on the wallets they control their private keys.
Over 100,000 BTC withdrawal per month!
Recent data from Glassnode highlights the increasing number of assets withdrawn from platforms for self-custody crypto wallets. In a message published yesterday, the platform specialized in publishing data showed that Bitcoin withdrawals reached 106,000 tokens per month. Very high level, rarely observed. This was already the case in April 2022, but also in November 2020 and to a lesser extent this summer.
The platform also highlights the fact that the most important withdrawals were on the day of November 9.
After the fall of FTX, #Bitcoin investors are withdrawing coins to self retention at a historic rate of 106k $BTC/month.
This compared to three other times:
– April 2020
– November 2020
– June-July 2022 https://t.co/92aYVYU4Yt pic.twitter.com/em7CsDBWUf— glassnode (@glassnode) November 13, 2022
In detail, Glassnode notes that the trend is noticeable among all types of investors. For those with less than 1 BTC and for those to be put in the whale category. The platform also notes that the trend has also been observed on stablecoins. And that it has also increased since the FTX crash.
Should we see the return of the uptrend?
Usually, the withdrawal of digital assets from platforms acts as a bullish parameter. In fact, in such a situation, the selling pressure is reduced. Which tends to push the price of the asset higher because there are fewer sellers. But in this specific case, it seems more like a crisis of confidence.
Recall that before its bankruptcy was announced, the FTX exchange was considered the second exchange in the world behind the Binance platform. So its fall has a distinct impact on the overall market.
Are we heading towards an era of self-preservation?
The famous phrase “Not your keys, not your coins” has never been more meaningful than it is today. And many voices are already echoing from the wallets. As early as November 13, in the middle of the FTX affair, Ethereum educator Anthony Sassano gave his opinion on the matter. Arguing that he considered that holders of digital assets should not hold their assets on centralized exchanges. According to Michael Saylor, self-hosted wallets act as a counterweight to centralized players like Binance or Coinbase.
Even CZ, the CEO of the Binance platform agreed. If he knows that he is walking on eggshells on this matter, the businessman wanted to recall that the possibility of owning his own assets was a fundamental right:
Self-preservation is a basic human right.
You are free to do it at any time.
Just make sure you do it right.
Start by recommending small amounts to learn the technology/tools first.
Mistakes here can be very costly.
Wait #SAFU— CZ 🔶 Binance (@cz_binance) November 13, 2022
Self-preservation is a basic human right.
You are free to do so at any time.
Just make sure you do it right.
We recommend starting with small amounts to learn the technology and tools.
Mistakes can be very costly.
The report published by Glassnode also questions the sustainability of this view. At this point, the report believes that the fall of FTX will have consequences for many parts of the crypto economy. And especially on storage methods. Capital flight for self-contained wallets may be just the beginning.
