The Bitcoin (BTC) balance held by BitMEX has been dropping drastically in the past month after the exchange experienced mass liquidations.
Exchanges are known to hold a large portion of crypto-assets in circulation. As BeInCrypto has reported, top exchanges like Coinbase and Bitfinex hold billions of dollars worth—and this number was growing for much of 2020.
However, March changed this trend. BitMEX, one of the top exchanges, is seeing its BTC supply shrink drastically.
BTC Supply Held by BitMEX Drops
A few weeks ago, Bitcoin and the entire cryptocurrency market suffered a massive drop. Shedding some 50% of its value, the cascading sell-off resulted in widespread liquidations across many different trading platforms. BitMEX, in particular, was hit the hardest.
Since then, the amount of BTC held by BitMEX has plummeted. On March 13, the exchange reached its peak with 315k or so BTC held. Now, that number has dropped to 244k BTC as of March 29.
The data was recorded by CoinMetrics, as seen below.
The amount of Bitcoin held by BitMEX has been in freefall over the past two weeks after BitMEX experienced mass liquidations on March 13th.
As of March 29th, BitMEX held 244k BTC, down from a peak of 315k on March 13th.
— CoinMetrics.io (@coinmetrics) March 31, 2020
It’s difficult to interpret what these numbers entail for the greater market. If anything, it may indicate that traders are losing faith in BitMEX. It also may indicate that the exchange is trying to get out of being over-exposed to BTC, which would be bearish at first glance.
Hard to trust BitMEX these days. They still have liquidation issues, lags way too much.
How come a big exchange like MEX can't fix their things within a few months? They just don't care and let the competition overwhelm them.
— Marry Chicone (@MarryChicone) April 1, 2020
Exchanges Keep Holding Tether (USDT)
Although BTC held by BitMEX seems to be dropping, it seems like there is now growing demand for stablecoins like USDT. As BeInCrypto reported, there has been a curious development as of late as exchanges continue to stockpile USDT. In fact, USDT balances on exchanges recently blasted past an all-time high.
With trading volume stagnating amid this global market rout, many cryptocurrency traders are sitting on the sidelines. In fact, growing demand for stablecoins may indicate that many are expecting a further drop in prices. As of now, there is much uncertainty over mainstream financial markets—and it’s difficult to predict where the cryptocurrency market will go in the short-term as a result. Fear still dominates the short-term perspective.
BitMEX holding less and less BTC is not inherently bearish, but it does indicate that public attitudes toward the exchange may be changing.