In the past week, a massive outflow has been recorded from the exchanges for Bitcoin (BTC). This is because the investors are now concerned and afraid of regulatory and security scrutiny.
Coinglass, a major on-chain monitoring resource for the crypto market has shared a rather alarming report. It shows that a great Bitcoin outflow has been taking place at the exchanges.
Outflow is the Highest in the US
The latest report shared by Coinglass has shown that it is the crypto exchanges based in the United States that have witnessed the highest outflow.
As per Bittribute, a cryptocurrency blog, these exchanges have been witnessing a great reduction in Bitcoin balances. The outflows recorded for Bitcoin from exchanges outside of the United States are considerably lesser than the US exchanges.
The entire cryptocurrency industry has become extremely fearful of the recent FTX scandal. Multiple comments and statements were made about the custodial BTC storage risks.
As a result, the investors started to withdraw their funds from the custodial platforms and moved them to the self-custody platforms.
$3 Billion were withdrawn
Right after the news started to rotate on social media, the withdrawals surged across the board. The situation started to worsen for the cryptocurrency exchanges as the outflows kept rising.
So far, the investors have withdrawn more than $3 billion worth of cryptocurrencies in a matter of a week. It was mainly due to the solvency issue with the FTX exchange.
Even the orders for the hard wallets have reached an all-time high, which shows that investors are favoring self-custody over exchanges.
Following the debacle, the regulations are on high alert and they are growing very thorough about their investigations of cryptocurrencies and crypto projects.
The authorities are now investigating the actions of the cryptocurrency exchanges and other crypto projects. It is only a matter of time before the regulatory authorities adopt strict regulations against crypto.
Even now, investors are withdrawing their funds from cryptocurrency exchanges. This is only increasing the overall number of outflows from the exchanges and the US is on top of it.
The report shows that the volumes of deposits are nowhere near the withdrawals in the recent week.
Platforms Facing the Highest Outflows
Among the platforms facing the largest outflows is Gemini, which has seen 30,000 BTCs leave its platform. The Gemini exchange is followed by Kraken, Binance, and Coinbase.
As the number of BTCs leaving the market keeps growing higher, many speculations are being made about Bitcoin’s future price movement.
Initially, it was expected that the investors withdrawing BTC would side with selling them. However, after a week of market downfall due to the debacle, the investors are regaining their confidence in BTC.
In this case, the outflows mean that the investors are HODLing their Bitcoin. As the HODLing continues, Bitcoin’s demand would continue rising which may help push BTC’s price higher.