40,000 Bitcoin Move Raises Question About Binance Bitcoin Balance
Recent massive bitcoin transactions on the largest cryptocurrency exchange have left traders wondering what could be happening in the crypto industry. Binance recorded a total outflow of 38,246 BTC after holders moved the coins to another platform. According to CryptoQuant, a firm that tracks crypto movements, Binance is now facing a significantly higher outflow than before, and it appears to be unnatural. The total balance of bitcoin in Binance is now a little under 500,000.
The huge transfer of bitcoins from the platform has thrown some traders into panic as they wonder what Binance is experiencing at the moment. The bitcoin balance on Binance will be a source of concern for investors especially as bitcoin has been on a strong bullish ride for weeks now. A massive reduction in the asset balance of any cryptocurrency exchange may be an indication of early sling pressure; traders will be on the lookout for such asset movement so that they can trade along with it.
What Happened?
Binance.US had a glitch caused by a bug recently. The glitch saw slippage levels slip, causing a massive drop in liquidity. The effect was a drop in value that saw the price of bitcoin drop to $8,000 on the US-targeted Binance platform. Bulls were quick to spot the unnatural dip and quickly began to place buy orders on the platform. This created an artificial liquidity problem on the platform, forcing the global Binance platform to quickly move bitcoins to the US platform to stem the effect of low liquidity. Low liquidity on an exchange can quickly cause severe losses and unpleasant trading conditions.
This is known as an in-house outflow. An in-house outflow is used to regulate liquidity on exchanges that offer country-focused exchanges. An unnatural deficit in liquidity is quickly corrected by the exchange. It is an important feature that ensures market stability by providing enough liquidity to keep the market going.
Bitcoin Price Movement
Bitcoin has performed excellently in the last two months, going on to hit a new all-time high price last week. The steady increase in bitcoin price followed months of a meltdown that started in May and lasted until late July. Investors and analysts have speculated a new ATH of $100,000 for bitcoin by December. This has led to bitcoin holders moving their assets from decentralized exchanges such as Binance and Huobi to wallets so that they can take some profits. There is no significant selling pressure yet; analysts expect more buying pressure before the next upward momentum to a new ATH.
Bitcoin remains the largest cryptocurrency in the world and retains its ability to influence the price of altcoins. The coin has surmounted serious challenges this year to hit new price levels. Following an outright ban in China, crackdowns on its miners in several countries, and the development of DeFi solutions that provide faster and easier networks, bitcoin has led the market rally this year, pushing beyond resistance zones to hit higher prices.
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