Crypto Exchanges Face Historic Liquidity Crunch Ahead of Bitcoin Halving

Bitcoin Exodus: Record $2 Billion Withdrawn from Exchanges in 90 Days

In the past 90 days, trading platforms have witnessed an unprecedented withdrawal of about 60,000 bitcoins, worth over $2 billion. The total number of bitcoins currently held on centralized exchanges is slightly more than 2 million. According to a recent report from Falconx, this significant reduction in liquidity has intensified the market's volatility.

Drastic Drop in Bitcoin Holdings on Exchanges

The number of bitcoins held on centralized exchanges has dropped to a multi-year low, with just 36,000 BTC remaining out of the 2 million that were held as of November 5, 2022. This sharp decline stands in stark contrast to the 2.513 million BTC that were stored on trading platforms less than a year ago.

Between November 5, 2022, and July 31, 2023, exchanges experienced a reduction of 477,000 BTC. As of the latter date, the total bitcoin holdings on these platforms amounted to 2.096 million. This means that a significant sum of $2 billion, equivalent to 60,000 BTC, has been withdrawn from these exchanges.

Decline in Ethereum and Stablecoins on Exchanges

A similar trend can be observed in the number of ethereum (ETH) held on centralized exchanges. Data from shows that on November 5, 2022, there were 23.14 million ETH stored on trading platforms.

However, as of October 30, 2023, the count of ether has dropped to 14.57 million, indicating that 8.57 million ethereum, valued at $15.64 billion, has been withdrawn from exchanges within a year. Additionally, stablecoins have also experienced a decline as they were either redeemed or removed by their central issuers.

Last November, exchanges held $35 billion worth of stablecoin assets. However, this figure has now reduced to $17.34 billion, indicating that over $17 billion in ERC20-based stablecoins have been redeemed or withdrawn from exchanges.

Impact on Market Volatility

The lack of liquidity in the cryptocurrency market is believed to be one of the main factors contributing to the recent volatility. According to a Falconx report, the depth of the crypto market in 2023 has reached its lowest point. With the upcoming bitcoin halving, these liquidity cycles are expected to become even more pronounced.

What are your thoughts on the significant decrease in crypto assets held on exchanges over the past 90 days and year? Share your opinions and insights in the comments section below.

Frequently Asked Questions

Can I have a gold ETF in a Roth IRA

You may not have this option with a 401(k), however, you might want to consider other options, like an Individual retirement account (IRA).

A traditional IRA allows for contributions from both employer and employee. Another option is to invest in publicly traded corporations with an Employee Stockownership Plan (ESOP).

An ESOP is a tax-saving tool because employees have a share of company stock as well as the profits that the business generates. The money in the ESOP can then be subject to lower tax rates than if the money were in the individual's hands.

An Individual Retirement Annuity (IRA) is also available. You can make regular payments to your IRA throughout your life, and you will also receive income when you retire. Contributions made to IRAs are not taxable.

Should You Buy or Sell Gold?

Gold was considered a safety net for investors during times of economic turmoil in the past. Many people are shifting away from traditional investments like bonds or stocks to instead look toward precious metals such gold.

The gold price has been in an upward trend for the past few years, but it remains relatively low compared with other commodities like silver or oil.

Some experts believe that this could change very soon. According to them, gold prices could soar if there is another financial crisis.

They also point out that gold is becoming popular because of its perceived value and potential return.

These are some things you should consider when considering gold investing.

  • The first thing to do is assess whether you actually need the money you're putting aside for retirement. You can save for retirement and not invest your savings in gold. That said, gold does provide an additional layer of protection when you reach retirement age.
  • Second, ensure you fully understand the risks involved in buying gold. Each offer varying degrees of security and flexibility.
  • Remember that gold is not as safe as a bank account. Your gold coins may be lost and you might never get them back.

Do your research before you buy gold. Make sure to protect any gold you already own.

Who is the owner of the gold in a gold IRA

The IRS considers any individual who holds gold “a form of income” that is subject to taxation.

To be eligible for the tax-free status, you must possess at least $10,000 gold and have had it stored for at least five consecutive years.

Owning gold can also help protect against inflation and price volatility, but it doesn't make sense to hold gold if you're not going to use it.

If you are planning to sell your gold someday, it is necessary that you report its value. This can affect the capital gains taxes that you owe when cashing in on investments.

To find out what options you have, consult an accountant or financial planner.


  • This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (
  • Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (
  • Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (
  • If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (
  • Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (

External Links

How To

Gold Roth IRA guidelines

Start saving as soon as possible to save for your retirement. You should start as soon as you are eligible (usually at age 50) and continue saving throughout your career. It is important to invest enough money each and every year to ensure you get adequate growth.

Also, you want to take advantage tax-free options such as a traditional 401k, SEP IRA or SIMPLE IRA. These savings vehicles let you make contributions and not pay taxes until the earnings are withdrawn. These savings vehicles can be a great option for individuals who don't qualify for employer matching funds.

The key is to save regularly and consistently over time. If you don't contribute the maximum amount, you will miss any tax benefits.


By: Jamie Redman
Title: Crypto Exchanges Face Historic Liquidity Crunch Ahead of Bitcoin Halving
Sourced From:
Published Date: Mon, 30 Oct 2023 18:30:51 +0000

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