15M BTC goes into self custody | Bitcointalksearch.org

hopenotlate

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Quote from: pawel7777 on May 30, 2023, 05:00:27 PM

Quote from: Minhxx on May 29, 2023, 05:42:16 PM

this is the general psychology of investors. A series of scandals came to the market and made them afraid and pressure to take profits caused the market to crash. That will pass quickly if we continue to hold our coins obliviously

No idea why have you decided to bump this 6 months old thread, but the topic discusses people choosing to withdraw from exchanges into non-custodial wallets. This is not the behaviour of someone looking to panic sell, but quite the opposite.

I wonder if the trend continued since this topic was created. I have no access to that chart on glassnode (not available to standard users) but if anyone could post an update, it would be great. I sense the outflow from exchanges was likely to continue, i.e. considering some regulatory limitations imposed on exchanges, e.g. binance closing their "earn" options in some of the countries, making it pointless for many to keep their funds there.

According to the data collected by coinglass.com and shown in the graph below Bitcoin outflow from exchanges has taken a pause in last six months but if we zoom out we can definitely state it is a general trend switching from exchanges to self custodial solutions.

pawel7777

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Quote from: Minhxx on May 29, 2023, 05:42:16 PM

this is the general psychology of investors. A series of scandals came to the market and made them afraid and pressure to take profits caused the market to crash. That will pass quickly if we continue to hold our coins obliviously

No idea why have you decided to bump this 6 months old thread, but the topic discusses people choosing to withdraw from exchanges into non-custodial wallets. This is not the behaviour of someone looking to panic sell, but quite the opposite.

I wonder if the trend continued since this topic was created. I have no access to that chart on glassnode (not available to standard users) but if anyone could post an update, it would be great. I sense the outflow from exchanges was likely to continue, i.e. considering some regulatory limitations imposed on exchanges, e.g. binance closing their "earn" options in some of the countries, making it pointless for many to keep their funds there.

SquirrelJulietGarden

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Quote from: Kakmakr on May 30, 2023, 12:20:14 AM

I think it has something to do with the US government, showing signs that it wants to over regulate Crypto currencies. The government can only concentrate their regulations on centralized services like wallet providers and Exchanges, so they are the main targets.

As governments, they do want to regulate things if they can do. They will try to do their best from regulation to gain more tax from their citizens. Their very first targets would be centralized exchanges, merchants, marketplaces and centralized cryptocurrency like altcoins. With cryptocurrency wallets, they will target custodial wallets first and even they aim at non custodial wallets, no way for them to control keys of those wallet users. It's their key, it's their coin.

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So, by moving your coins out of these centralized services, you effectively "free" up your tokens from these strict regulations.

Bitcoin is a coin, not a token.

Kakmakr

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I think it has something to do with the US government, showing signs that it wants to over regulate Crypto currencies. The government can only concentrate their regulations on centralized services like wallet providers and Exchanges, so they are the main targets.

So, by moving your coins out of these centralized services, you effectively "free" up your tokens from these strict regulations. We just hope that the US elections will sort out these dark clouds that are hanging on the horizon. Roll Eyes

Minhxx

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this is the general psychology of investors. A series of scandals came to the market and made them afraid and pressure to take profits caused the market to crash. That will pass quickly if we continue to hold our coins obliviously

franky1

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Quote from: franky1 on December 18, 2022, 10:03:38 AM

update

using the "bitcoin richlist"
the top 3 categories
january 2022
[100,000 - 1,000,000)   793,314 BTC
[10,000 - 100,000)   2,262,241 BTC
[1,000 - 10,000)   4,630,567 BTC

december 2nd
[100,000 - 1,000,000)   672,354 BTC
[10,000 - 100,000)   2,072,651 BTC
[1,000 - 10,000)   5,177,623 BTC

december 18th
[100,000 - 1,000,000]   684,123 BTC
[10,000 - 100,000)   2,291,459 BTC
[1,000 - 10,000)   4,601,707 BTC

january 12th 2023
[100,000 - 1,000,000]   668,306 BTC
[10,000 - 100,000)   2,306,719 BTC
[1,000 - 10,000)   4,573,406 BTC

which is a total of
Jan 2022 7922628
dec 2nd: 7686122 (average 770 a day removed(jan-dec day avg))
dec 18th: 7577289 (average 6800 a day removed(dec day avg))
jan 12th: 7548431 (average 1154 a day removed(dec-jan day avg))

there were 7.92m in large hold addresses (services, custodians) last january
out of 19.26m circulation means that 11.34mill were more likely a number in "self custody"

there are 7.54m in large hold addresses (services, custodians) this month
out of 19.26m circulation means that 11.72mill were more likely a number in "self custody"

Flexystar

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Still people are using the exchangers like never before. I don't know but these incidences from the last year should have ignited marching of Not your keys Not your Bitcoin long ago but it only seems that forum people are aware about it and not the whole crypto community. You say - you say, there are always brokers, institutional investors who are going to deny the fact and will attract their customers to invest and as soon as they invest they will get the custodu of their coins and you will loose the ownership right there.

A person lost more than 4 billion against the lawsuit filed over exchangers custody. ToS simply stated if they are in the possession of exchanger then they are gone.

Husires

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Quote from: Lucius on January 11, 2023, 11:59:05 AM

That doesn't seem very credible to me, because if 15 million BTC is in self-custody, all those analyzes that said that about 4 million BTC were lost, then it turns out that CEX doesn't really have anything or just dust?

On the contrary, the word "self-custody" refers to the possibility of accessing the private key of one individual, whether he has access to that private key or not, and therefore in this term he enters:

Coins that have been withdrawn from CEXs.
Coins that have been mined and not sold.
Coins in cold storage (even CEX cold storage)
Lost coins.

So the number is logical or is it a measure of whether the money is in the hot storage or not.

you can read this with

Lucius

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Quote from: Husires on January 11, 2023, 09:30:14 AM

According to this report 15 million BTCs are now held in self-custody which leaves less than 22% of all mined BTC on exchanges.
It's been a month since I wrote this thread and it seems that more and more investors still prefer to keep their currencies off the platforms.

That doesn't seem very credible to me, because if 15 million BTC is in self-custody, all those analyzes that said that about 4 million BTC were lost, then it turns out that CEX doesn't really have anything or just dust? I know that this whole story about where are all the mined BTC and how much has been lost is mostly made up of speculation based on a not very logical methodology, but something in that story is not right and someone is obviously manipulating the data.

Husires

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According to this report 15 million BTCs are now held in self-custody which leaves less than 22% of all mined BTC on exchanges.

It's been a month since I wrote this thread and it seems that more and more investors still prefer to keep their currencies off the platforms.

We hope it will be a continuous trend.

KingsDen

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Quote from: Husires on December 02, 2022, 07:30:21 AM

This is not a very great news, neither is it a news that should bother us for so long because the movement of funds in cryptocurrency has started for so long and will continue to happen in as much as the cyclical nature of Bitcoin continues to happen.
Let's keep the exchanges problem outside for now, when bitcoin goes down again to the bearest bottom and start to move towards Bull state you will understand that many people will need to move their money back to exchanges in order to buy Bitcoin.

So it does not make any difference for the movement because they will still go back to exchange. Even in this process many people will lose their funds. It will be fine that we stop creating this FUD we are creating.

panganib999

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Quote from: Marvelman on December 18, 2022, 04:25:28 PM

I've always wondered, how do these on-chain data analysts know that coins are going into self-custodial wallets? Do they consider everything that is not related to exchanges or some other known services to be self-custodial? That doesn't necessarily have to be the case.

I think they have parameters set that will at least let them predict it's a self-custodial wallet. For instance there should be indicators on the address AFAIK, and the number of incoming and outgoing transactions could also be a giveaway to what type of wallet that is. I find that I have a lot of incoming transactions in my cold wallet, they could've applied the same logic here. Finally, its relevance to the current events. As said earlier this massive move happened after the collapse of FTX, so an educated guess could be made that would lead someone to think this is an upsurge of users transferring their money to cold wallets.

Marvelman

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I've always wondered, how do these on-chain data analysts know that coins are going into self-custodial wallets? Do they consider everything that is not related to exchanges or some other known services to be self-custodial? That doesn't necessarily have to be the case.

panganib999

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This is to be expected. The not your keys not your movement statement that proceeded FTX's collapse made grounds on the crypto space and had shed light on how little your control is when you entrust your coins to a centralized exchange no matter how trustworthy they are. I suppose another bullrun may implore these investors to use their money and bring it to their hotwallets again but that'll take time, seeing as things go we are still in recession, and it may take a while for the outside economy to recover, and incidentally crypto market itself.

Welsh

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Quote from: mk4 on December 02, 2022, 07:34:54 AM

Also, while this is great news, let's not forget that people can still just easily send back coins to exchanges once things settle down.

Which is likely the case. Exchanges are a hot topic, and several news sources as well as users on the forum are talking about a domino effect, potentially happening. Probably has a lot of users spooked, and therefore they've temporarily decided to take it off of exchanges.

It'll be interesting to see what happens again after a year. A lot of these people are traders, so they'll insist on having their coins on an exchange for the fastest possible way of trading, and therefore capitialising on the market. Even though, I personally disagree with that approach.

lizarder

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Quote from: skarais on December 02, 2022, 08:06:44 AM

They even noticed it before the FTX crash, but they believed in the exchange so much they didn't mind it. However, as far as FTX is concerned, there are many negative issues that may make them uncomfortable keeping their assets on the exchange so they choose to withdraw their assets to their respective wallets.

If indeed the FTX case has taught us about security, then will the percentage of trust in other exchanges have any effect. To this day how many exchanges are listed and how do they provide answers regarding the level of security, while the owner of Binance once said, that the exchange is not a place for long term asset storage (if my memory serves me correctly).

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But as @mk4 says, these assets will be very easy to transfer back to the exchange when their holders start to trust the exchange again as before. For a while, the situation of centralized exchanges really lost a lot of holders as most of them withdrew their assets, but it will return to normal with time.

Exchange reputation has different levels of trust. When the FTX case starts to no longer be discussed in the public sphere and it no longer makes people feel afraid, it will return to normal conditions. On the other hand, many people are starting to realize that the exchange is not a safe place to store assets, both for the long term and in large quantities.

franky1

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update

using the "bitcoin richlist"
the top 3 categories
january 2022
[100,000 - 1,000,000)   793,314 BTC
[10,000 - 100,000)   2,262,241 BTC
[1,000 - 10,000)   4,630,567 BTC

december 2nd
[100,000 - 1,000,000)   672,354 BTC
[10,000 - 100,000)   2,072,651 BTC
[1,000 - 10,000)   5,177,623 BTC

december 18th
[100,000 - 1,000,000]   684,123 BTC
[10,000 - 100,000)   2,291,459 BTC
[1,000 - 10,000)   4,601,707 BTC

which is a total of
Jan: 7922628
dec 2nd: 7686122 (average 770 a day removed(jan-dec day avg))
today: 7577289 (average 6800 a day removed(dec day avg))

seems people are still pulling coins out of exchanges, and it seems to be more coins on average per day in december than the amount per day average for the year

Husires

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Update:
Around 200k Bitcoin flowing out of exchanges last 30-days worth $3.4 billion.

Source: https://www.reddit.com/r/Bitcoin/comments/ze7f90/around_200k_bitcoin_flowing_out_of_exchanges_last/

It seems that some began to learn the lesson and withdrew their currencies, as about 200k bitcoins is not considered a small amount, but for how long this memory will remain strong and they will not try to be lazy and leave their currencies in centralized platforms.

As we can see from the charts, the amount of bitcoins out of exchnages these 30 days is the largest even since 2016.
I expect people to forget all these details with the next cycle after about three years

teosanru

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Quote from: Husires on December 02, 2022, 07:30:21 AM

according to Glassnode on-chain data analyzed by Cryptoslate, leaving less than 22% of all mined BTC moving around and exchanging hands.

These indicators show that investors are starting to withdraw their digital assets away from the exchanges, whether using wallets or other methods.
Indices measure the movement of currencies as a function of whether the transaction is in cold storage or in a hot wallet.

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Think of illiquidity as the point when Bitcoin moves to a wallet that shows no spending history, while liquidity is when BTC moves to wallets that have a history of spending such as hot wallets and exchanges.

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The chart above demonstrates the amount of highly liquid and liquid BTC assets and shows the figures are currently 3 million and 1.3 million coins respectively. The data is clear that both liquid and highly liquid supply have been trending downwards amidst the current market turmoil

Source: https://cryptoslate.com/research-2nd-december-the-15m-bitcoin-just-went-into-self-custody/

Is everyone beginning to understand Not your Keys, Not your coins , or is it temporary because of FTX?

Excellent infographics and I think these really actually depict what you are saying. This seriously means that people are taking things seriously and they are doing what actually they should have done from very start. Moreover obviously with the world's second biggest exchange going bankrupt like this it's obvious your trust on such systems goes very down. But yes you are eight it can be temporary as well because people really forget these things in long term when they see ease.

albertorma

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It's clear that the decrease in the number of Bitcoin moving around / exchanging hands is due to a growing awareness among investors of the importance of securely storing their Bitcoin. As more people became aware of the risks associated with keeping their Bitcoin on exchanges, shitchain bridges or even in hot wallets, they are taking steps to move their funds into more secure forms of storage. This is a positive development that implies people becoming more savvy about managing their own Bitcoin and taking steps to protect It.

It's also important to remember that even though centralized exchanges play a legitimate role in the Bitcoin ecosystem, Bitcoin was never intended to be custodied by a third party. The decentralized nature of Bitcoin means that individuals are ultimately responsible for the safekeeping of their own funds, and it's crucial for people to take steps to protect their networth and retain control over their own Bitcoin.

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