Out of stock! Since the announcement of a possible Bitcoin spot ETF by giant BlackRockcrypto market prices back on track upwards. Individuals and institutions in particular are snapping up the two most highly-valued cryptocurrencies: Bitcoin (BTC), but also the ethers ofEthereum (ETH). This is not without consequences for crypto exchanges, as recounted in a recent report by the mega-bank Goldman Sachs.
Goldman Sachs says: there is no confidence in exchanges
The announcement of multiple exchange-traded funds (or ETF) on Bitcoin by asset management giants at the end of June propelled the price of the queen of cryptocurrencies above the $30,000 mark. But, the cryptosphere and investors interested in digital assets haven’t forgotten the disasters of 2022including the terrible fall of the FTX empire by Sam Bankman-Fried.
As the reports including CoinDesk, a recent report from the multinational bank Goldman Sachs confirms this loss of confidence towards cryptocurrency exchange platforms. Especially since regulatory harassment to which these players are subjected, particularly in the United States, is not likely to reassure crypto-investors. The latter prefer hold their own their precious bitcoins and ethers.
« Major centralized exchanges are facing regulatory headwinds putting investors on high alert, while cyber-attacks and theft continue to be a concern across cryptocurrency markets. » (…) [Ainsi,] crypto-asset owners’ preference for self-holding, in line with the popular adage « not your keys, not your cryptos », (….) has led to investors’ preference for staking their ethers, rather than passively holding them on exchanges. »
Extract from Goldman Sachs report
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Bitcoins and ethers leave crypto exchanges in droves
The paradoxis that Goldman Sachs points out that minersproducers of bitcoins, have nevertheless made record sales in the month of June 2023. Crypto mining companies have benefiting from rising prices to sell part of their precious production in BTC.
Compared with the previous month (May 2023), this represents an increase of almost twice as many bitcoins passed from miners to exchanges ($99 million in June).
And yet, crypto exchanges are becoming increasingly dry. In fact, according to the Goldman Sachs bankers’ report, the quantity of bitcoins available on crypto-asset exchanges a down 4% during the month of June. A level not seen since December 2022. For the ethersit’s even worse with the lure of staking rewards. The quantity of available ethers has plummeted by 5.8%.. Levels so low they hadn’t been seen since May 2018!
Although some players, such as crypto exchange CoinbaseDespite the fact that Coinbase is in the midst of a regulatory battle with financial regulators, they are not giving up. Coinbase is looking to regain trust of investors, especially the wealthy institutionaland will be a mainstay of BlackRock’s successful BTC spot ETF.
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