$3 billion in Bitcoin left the exchanges this week due to fears of FTX contagion
Bitcoin (BTC) investors are withdrawing funds from exchanges at a rate not seen since April 2021 with nearly $3 billion in Bitcoin withdrawn in the past seven days.
New data from chain analysis firm Glassnode shows that the number of wallets receiving BTC from exchange addresses reached nearly 90,000 on November 9.
Exchange users are waking up to self-storage
Amid ongoing unrest over the bankruptcy of major stock exchanges FTX, concerns have increased among stock exchange users about the safety of funds.
Commentators have raised the bar to avoid custodial wallets and take control of crypto assets, and regulators are ramping up scrutiny of the crypto industry.
Figures from the chain suggest that a large number of hodlers have opted for non-custodial wallets in the past week.
The number of withdrawal addresses saw a huge increase on November 9, surpassing the daily highs for both May and June this year when BTC price action last saw significant downside pressure.
As of November 12, the latest date for which data is available, there were still over 70,000 withdrawal addresses.
The same Glassnode data gives an hourly average of over 3,000 withdrawal addresses during the seven days up to 13 November.
Analysis: BTC reserves may not tell the whole story
The numbers dovetail with what appears to be rapidly declining BTC reserves across major trading platforms.
Related: Bitcoin Will Shrug Off FTX ‘Black Swan’ Just Like Mt. Gox — analysis
While the speed of the drop suggests that the true balance count may be difficult to confirm at the moment, data from fellow chain analytics resource CryptoQuant puts total currency reserves at their lowest since February 2018.
CryptoQuant tracks a total of 38 exchanges, including those with reported financial problems such as FTX and Kucoin.
Another chart, this time from Coinglass, suggested 177,000 BTC in weekly withdrawals through November 13 – a US dollar value of around $3 billion at today’s price.
Still, Glassnode senior analyst Checkmate flagged three exchanges in particular with what he called “particularly weird” Bitcoin balance readings – Huobi, Gate.io and Crypto.com.
Final a dedicated thread into the subject, he noted that “Valtas age is best estimate based on wallet clusters. They are more likely to be a lower bound than an overestimate.”
“These fund flows between exchanges include both real clients + FTX/Alameda. Hard to separate, and thus appear relative to balance,” he added.
Michaël van de Poppe, founder and CEO of trading company Eight, predicts how the current scenario could play out, meanwhile the worst was probably not over yet.
“We will probably have more problems with exchanges in the coming weeks, but probably also a lot of gossip,” he told Twitter followers this weekend.
“Stay safe, stay calm and don’t make emotional decisions. We are in terrible territory, but crypto will come out of this stronger.”
BTC/USD was trading around $16,500 at the time of writing, data from Cointelegraph Markets Pro and TradingView showed.
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