The fall of Sam Bankman-Fried’s $32 billion crypto empire highlighted the importance of self-custody for users. In fact, investors have already hopped on the trend of holding their assets themselves rather than entrusting their hard-earned money to a third-party platform.
According to the latest data compiled by crypto analytic company, Santiment, Bitcoin’s supply on centralized crypto exchanges has dropped from 11.85% to 6.65% over the past year.
- The exodus of the flagship crypto-asset was seen across the top six platforms, including Binance, Coinbase, Kraken, KuCoin, and Bitstamp.
- Kraken was hit the highest as it saw a 59% reduction in BTC balance, followed by Coinbase with 33%, Bitfinex and KuCoin with 32% each, Binance with 25%, and lastly, Bitstamp with 23%.
- This trend essentially marks a historic drop in overall BTC supply, demonstrating the rising interest in self-custody.
- Fundamentally, the less Bitcoin there is on exchanges, the more investors see it as a long-term investment. Expectedly, it also means that there’s less immediate sell pressure.
- Earlier this year, Bitcoin core dev, Like Dashjr, lost millions in an exploit after attackers allegedly managed to access his PGP key, raising risks associated with self-custody.
- Adam Back, who happens to be one of Bitcoin’s earliest contributors, believes Dashjr was targeted through his home network and had his machines compromised.
- Nevertheless, self-custody comes with its own risks. But investors flocking to these products have led centralized exchanges to expand their offerings.
- As such, Binance recently announced a new feature – Mirror – based on Binance Custody to enable institutional players to invest and trade using cold custody.
- In fact, Binance Venture, the venture capital arm of the CZ-led exchange, also invested in Belgium hardware wallet company, Ngrave.
The post Bitcoin Sees Historic Drop on Exchanges, Here’s What it Means appeared first on CryptoPotato.
The overall supply of #Bitcoin on exchanges has dropped from 11.85% to 6.65% over the past year, a historic drop that illustrates the rise in interest in self custody. #Binance, #Coinbase, #Kraken, #Kucoin, and #Bitstamp all reflect this $BTC exodus. https://t.co/4GSJs29fOK pic.twitter.com/aDLuAw3oiU
