• Roughly $120 million worth of Bitcoin (BTC) was withdrawn from crypto exchanges on Jan. 10.
• Binance saw $50 million of the withdrawals, while Coinbase saw $30 million.
• Crypto investors have favored self-custody, as Bitcoin balances on exchanges declined and illiquid supply in cold or hot storage wallets passed 15 million coins.
On January 10th, a significant amount of Bitcoin (BTC) was withdrawn from crypto exchanges across the world. According to Glassnode’s data, the total withdrawal was estimated to be around $120 million. Of this amount, Binance saw $50 million of the withdrawals, while Coinbase saw $30 million.
These numbers are significant in the context of the decline of Bitcoin balances on exchanges over the past few months. This decline was first seen when FTX, a crypto derivatives exchange, collapsed late last year. As a result, Binance saw over $600 million BTC withdrawn from its reserve in a single day, while Coinbase saw BTC withdrawals of roughly $3.5 billion in November.
These withdrawals are indicative of the increasing trend of crypto investors favoring self-custody over exchange custody. This is because self-custody is considered to be safer than storing funds on exchanges. Thus, as a result of these withdrawals, Bitcoin’s illiquid supply in cold or hot storage wallets has also passed 15 million coins.
However, self-custody is not without its risks. Recently, a Bitcoin core developer lost more than 216 BTC to a compromise while attempting to self-custody his funds. This incident serves as a reminder that no matter the security measures one takes, there is always a risk associated with self-custody.
In conclusion, the withdrawal of $120 million worth of Bitcoin from crypto exchanges on January 10th serves as a reminder of the ever-growing trend of crypto investors favoring self-custody over exchange custody. Despite the risks associated with self-custody, the amount of Bitcoin stored in cold or hot storage wallets has passed 15 million coins, indicating that many investors do favor self-custody for the added security it offers.