According to data reviewed by CryptoSlate, after the FTX collapse, investors are shifting significant quantities of Bitcoin (BTC) to their self-custody wallets and leaving Ethereum (ETH) to invest in stablecoins.
BTC Rushes to Self Custody
The amount of very liquid, illiquid, and liquid Bitcoins since 2008 is depicted in the graphic below.
The number of Bitcoins stored in self-custody wallets almost hit 15 million as of November 2022. This indicates that 78% of the 19,204,000 Bitcoins in circulation today are held in self-custody.
More information about the illiquid Bitcoin supply can be found in the graphic below, which also demonstrates that this week saw a significant increase.
The community may have benefitted greatly from the recent events involving FTX’s liquidity problem as a result of the important lessons it learned, as seen by the sharp increase.
FTX recently pledged to do all in its power to supply liquidity, but it made no commitments beyond that.
Notable Stablecoin Strength In the Markets
The table below compares the market capitalizations of the top four stablecoins, Tether (USDT), USD Coin (USDC), Binance USD (BUSD), and DAI (DAI), which are all based on distinct blockchains.
According to the data, as of November 11, stablecoin dominance had surpassed Ethereum dominance. This unique occurrence in June 2022 is a strong indication that investors are shifting substantial sums of money into stablecoins as the market capitalization of Ethereum declines.
Dwindling Confidence In Exchanges
A lot of these moves could be occasioned by declining investor confidence in exchanges. It’s an easy call based on what has been happening over the last week with companies like Blockfi holding out on withdrawals.
A billion dollars worth of crypto has been frozen in the FX exchange with distraught investors unable to access that money.
A failed Binance takeover that would have saved investors the pain fell through at the last minute after Binance was spooked by legal and other issues affecting the exchange.
Then news of Tron possibly taking over the exchange leaked just for hopes to be dashed by FTX filing for bankruptcy, leaving millions of investors shell-shocked.
Image Courtesy Of Shutterstock
