- The balance of Bitcoins on some of the major exchanges is falling rapidly, according to recent data.
- There are many reasons why this may be the case, including the newly discovered appreciation of BTC.
- With only a few exchanges seeing these reductions, many believe they are losing customer confidence.
The supply of Bitcoin (BTC) held by major exchanges has fallen to levels that have not been seen in the past two years. The last time BTC's balance on major trading platforms was so low was in 2018, according to data collected on October 20.
People are realizing the value of Bitcoin
The crypto industry grew rapidly throughout 2020 and for a number of reasons. The existing crypto community has been buying with the intention of HODLing since BTC fell for the third time, expecting prices to skyrocket.
Then there was the COVID-19 pandemic, which caused the global economic collapse due to pure fear of what it can do to various sectors. In the end, the world began to realize something that the crypto industry has known for years – BTC is the only asset that offers a solid monetary policy.
At least that's what Nexo co-founder Antoni Trenchev recently noted. He said BTC is the best performing asset of the decade and that the world has begun to realize this.
He added that the community is resorting to self-care solutions, which include platforms such as Nexo itself. These platforms allow tax-saving loans against assets that users already own.
There is no need to sell to win, and all the popularity has generated more discussions about crypto than ever before.
BitMEX and Bitfinex may be losing users' trust
Celsius co-founder Alex Mashinsky expects this state of affairs to continue unless the exchanges change the terms of the deals they are offering in order to lure users back to their platforms.
Not all exchanges are affected equally, of course. Platforms like Binance and Coinbase, which offer good conditions to their users, have kept their funds. Meanwhile, companies like Bitfinex and BitMEX have seen severe reductions in their assets.
The rise of the DeFi sector has undoubtedly contributed as well as the growing interest of institutional investors. They used companies such as grayscale and Microstrategy to accumulate large amounts of BTC throughout the year. Anyway, some exchanges seem to be losing the trust of their users, though not all, as mentioned.