When the first CEX (Centralized Exchange), Binance finds itself in troubled waters, there is reason to wonder what happens to the world’s first crypto, bitcoin (BTC). Indeed, the market is hungover at the end of the year following the announcement of massive withdrawals on Binance. According to Nansen, the blockchain analysis platform, 3 billion dollars have been stolen from the exchange whale. Moreover, the impact of this information was not long in coming on the entire market, in particular on bitcoin (BTC). Let’s see together to what extent he is doing well in this news.
The current analysis was prepared in collaboration with the Bitget crypto exchange platform. Present in more than 100 countries, Bitget is an exchange of cryptocurrencies created in 2018. With a user base amounting to more than 8 million, the digital asset platform offers a variety of services to its customers. These include derivatives trading, spot trading, social trading and copy trading. Thanks to its innovative products, Bitget appeals to both amateurs and professionals.
Bitcoin (BTC) in the face of turbulence from Binance
The year 2022 is definitely not a vintage for the crypto market. The FTX episode is not yet over that we are already diving into that of Binance. The queen of cryptos also toasts. Thus, it sees its price take a nosedive when it had started a good recovery at the start of the week.
The tree that hides the forest
Nansen We learn earlier this week that a fiat currency equivalent of $3.66 billion left Binance. For clarity, this data relates only to the movements of Ethereum and ERC-20 tokens.
In fact, the amount of bitcoins withdrawn from Binance shows a positive 30-day balance. However, on closer inspection, 80,577 BTC (about $1.3 billion) have been withdrawn from Binance in the last seven days according to Coinglass.
It is clear that it is Binance that wins the gold medal in terms of net weekly bitcoin withdrawals on a CEX. However, this downward movement in bitcoin withdrawals from exchanges is a phenomenon of greater amplitude which is already extending over several months.
It was last November that we mentioned the record number of bitcoins leaving the exchanges. Thus, 72,900 BTC were withdrawn in a single week. Let’s look at this in more detail:
It is clear that the number of bitcoins present on the exchanges is in constant decline. 1.9 million BTC are in circulation on the exchanges. Given that 19.2 million BTC are in total circulation, we deduce that 90% of bitcoins are therefore illiquid today.
Glassnode had already told us before the bear market:
However, the situation is not improving given the current news on Binance.
When will the Bitcoin phoenix rise from the ashes?
The announcement of the slowdown in US inflation gave a boost to the price of bitcoin (BTC) which even reached $17,785 to December 14. However, this comeback did not last very long. News of the massive withdrawals on Binance sent the currency created by Satoshi Nakamoto into a bearish spiral again.
However, what at first appears to be another setback given to the crypto market may actually be the source of its salvation. Indeed, long-term BTC holders are bringing a new dynamic to the availability of bitcoin (BTC). This reality is all the more instructive as the number of active BTC addresses decreases.
The big winners of this phenomenon are the providers of hard wallets to the detriment of the exchanges. As the recipients of those cryptos that evade CEX, they get the lion’s share. For the first time in the history of the number 1 crypto, the volume of bitcoins belonging to old holders (from 7 to 10 years and more) exceeded that of the reserves of all the exchanges combined.
If this conservation trend continues, we are headed straight for bitcoin (BTC) scarcity. This is not necessarily a disaster scenario, quite the contrary. It follows from the massive adoption of bitcoin (BTC) a real demand. From infrastructure to the exchange of goods, bitcoin (BTC) has taken the world by storm so that all sections of society are concerned.
Such illiquidity and a demand driven market pattern would tend to bull the market. This is a rather encouraging prospect for bitcoin (BTC), the unavailability of which can be a lever for its price growth.
To conclude,
Since its creation 14 years ago, bitcoin (BTC) continues to give way to debate. Especially since the context of the bear market gives rise to all the speculation. Yet, lo and behold, the currency created by Satoshi Nakamoto is over a decade old with worldwide adoption. We are far from a matter of a few scholars. The reality with this unscrewing bitcoin (BTC) price is that it has already been on a rollercoaster ride. Nevertheless, he has always stood out for his resilience.
Therefore, a trend of investor hoarding is not necessarily a bad omen. Concretely, the growing unavailability of bitcoin (BTC) on the market could bring it a favorable wind. The possibility of a rally is therefore not to be dismissed out of hand. Other variables obviously come into play when it comes to bitcoin’s rise. This is the case of halving or even the positioning of regulators such as the SEC (US Securities and Exchange Commission).
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