Why are people withdrawing from Coinbase?
Why are people withdrawing from Coinbase?
2 encouraging takeaways
Quote of the day. “Long term gains far exceed short term gains, in the long term”
In a recent report from Glassnode (link here) we learned something interesting; many people are withdrawing their bitcoin from Coinbase. For the first time, btc on Binance has surpassed those held in custody by Coinbase. But the interesting part is that it appears self custody is going way up and for holders of all sizes. This does not apply just to shrimps (holders of less than 1 btc) but also to holders of large amounts of 10k-20k. In total large exchanges have been seeing withdrawals of about 145k btc per month. So why are people withdrawing from Coinbase, I don’t know, but we can guess it is the same reason they are withdrawing from exchanges in general. They have been spooked by what happened at Celsius, Voyager Digital and elsewhere. I see two encouraging takeaways. First, small and large investors alike are withdrawing. For an institutional investor, it usually requires a long process to put in place a self custody solution. So this probably indicates real progress in self custody infrastructure and education. Secondly, we see that at each bear market, the number of users in the ecosystem increases. We see an increase in the number of holders of btc, in their diversity and in their education. These are all encouraging signs. User adoption and innovation are much more important than price. User adoption and innovation are the signal, price is mostly noise.
If you want to learn how a custodial institution can safely custody btc, listen to this podcast and learn what an HSM is and how it works. Or Listen to this podcast to learn how to safely secure large amounts yourself, with a multi-sig.
Continue to think long term, you will be rewarded!