One of the biggest withdrawals from the major cryptocurrency exchange in the United States, Coinbase, occurred last week when several investors moved about $1 billion in cryptocurrency out of the platform.
Coinbase’s holdings of bitcoin fell to their lowest point since 2015 as a result of this.
A combination of circumstances has led to the aggregate removal of 18,000 bitcoin (worth about $1 billion) from Coinbase this month by “whales,” or people who accumulate substantial cryptocurrency holdings. A price increase for bitcoin may be anticipated by some due to the upcoming halving of the cryptocurrency in April, while others may believe that liquid bitcoin holdings could be beneficial for upcoming over-the-counter cryptocurrency trading.
In light of the U.S. Securities and Exchange Commission’s (SEC) lawsuit against Coinbase, which claims the company operated an unregistered securities exchange, broker, and clearing agency illegally, some people may be looking for alternative custodians for their bitcoin.
Institutional demand for bitcoin surged this past January following the SEC’s approval of multiple spot exchange-traded funds (ETFs). Almost $500 billion has been deposited into the new bitcoin ETFs on a net daily basis. Currently, over 900 bitcoin are mined every day. But following the halving, there will be about 450 less bitcoins mined per day.
According to Lucas Kiely, chief investment officer of Yield App, “the spike in bitcoin values and institutional backing by players like BlackRock and VanEck are important drivers behind consumers’ growing confidence in crypto.
A solid sign that the cryptocurrency market is maturing, according to him, is the appearance of ever-more-complex financial instruments that appeal to professional traders and facilitate institutional adoption.
