Bitcoin Crypto

$1.8 Billion Worth of Crypto Leaves Market as Bitcoin Breaks Through Resistance

03/20/2022
Bitcoin Ethereum News

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Arman Shirinyan

Cryptocurrency market faces massive outflows as traders lose trust in exchanges

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The large outflows hit the cryptocurrency market as $1.8 billion worth of Ethereum, Bitcoin and Tether left the market. We could tie such a strong outflow to the extreme fear on the market.

Net flow by position

Ethereum has faced the largest outflows on the market, with $748 million in the cryptocurrency moved from centralized exchanges. As Glassnode data suggests, the net flow for Ether remains at -164 million.

Bitcoin’s net flow also remains negative, with $700 million worth of cryptocurrency leaving the market as traders move their funds away from exchanges. Previously, U.Today noted that massive outflows during the correction period may cause a supply shock in the future, when the demand for cryptocurrency recovers to 2021 levels.

The only cryptocurrency that faced a positive net flow was Ether-based Tether stablecoin with $353 million poured into the market, which may reveal two things: traders will purchase more cryptocurrencies with their Tether holdings, or the Treasury releases more coins into circulation to balance the price of the asset.

Why do traders choose to move funds away from exchanges?

While economic and market causes could affect traders’ desire to move funds away from centralized entities, the limitations that exchanges faced recently from regulators caused a panic among cryptocurrency investors who kept their holdings on exchanges.

Many CEOs warned users about their inability to avoid orders from financial regulators and that they will have to ban or limit traders. Statements incentivized outflows from all major exchanges as traders started actively moving funds to cold or hot noncustodial wallets with one-sided access.

Source: https://u.today/18-billion-worth-of-crypto-leaves-market-as-bitcoin-breaks-through-resistance