Bitcoin’s value has been up dramatically for the reason that very day common change OKEx introduced the suspension of all crypto withdrawal service on its platform. Nevertheless, whereas some tie the 2 collectively, many market observers don’t see a purpose to affiliate the most recent value rally with OKEx’s points.
Whereas the worth of bitcoin gained considerably for the reason that market sell-off in March, the newest bullish run started simply as OKEx mentioned it suspended all crypto withdrawals as a result of considered one of its key holders has “been out of contact.”
Nevertheless, the suspension of withdrawals on OKEx had little impression on bitcoin’s value over the previous month, mentioned Ki Younger Ju, chief government officer of CryptoQuant.
“BTC’s value on OKEx will not be that totally different from different exchanges,” he mentioned. “…[P]eople can commerce their BTC on OKEx regardless of the withdrawal suspension.”
The Malta-based crypto change nonetheless stays the No. 1 place for bitcoin futures open curiosity, presently price $1.22 billion, based on information supply Skew.
OKEx mentioned Thursday it would resume withdrawal service as soon as this week, after founder Mingxing “Star” Xu was mentioned to have been released from police custody in China. Jay Hao, chief government officer of OKEx, instructed CoinDesk its excessive open curiosity is a optimistic indicator for his firm.
“These are encouraging indicators that confidence within the change stays excessive and I imagine that even when some customers determine to withdraw their funds [as soon as withdrawals are open], which is their whole and absolute proper, they’ll quickly come again to OKEx,” Hao mentioned via a spokesperson on Telegram.
Decreased Chinese language miners’ impression on costs
Bitcoin’s quantity from miners to OKEx has additionally dropped to nearly zero for the reason that information got here out, as information from Glassnode present.
The muted bitcoin switch quantity from miners to OKEx, whose customers are largely Chinese language, is in keeping with the argument that the worth surge is partly attributable to drying up in provide. Miners in China are struggling to turn their bitcoin into cash due to a authorities crackdown on Chinese language exchanges.
Darius Sit, founding father of Singapore-based buying and selling agency QCP, connects the scenario for miners in China with the market, telling CoinDesk that as an alternative of going to different platforms, miners could have been holding on to their bitcoins as costs proceed to climb, inflicting a tightened bitcoin provide.
But, others have largely disagreed with such contentions, saying the availability of bitcoin affected by OKEx’s withdrawal suspension is comparatively small.
“As a category, miners aren’t that enormous a gaggle of sellers,” Ryan Watkins, bitcoin analyst at Messari, instructed CoinDesk in a Telegram message. “[They are] positively not sufficient to drive the worth up as excessive as it’s.”
As an alternative, Watkins identified the current bitcoin rally is generally pushed by the demand aspect, as institutional traders in North America have been shopping for bitcoin in giant quantities.
The “excellent” timing of OKEx’s suspension and the worth rally might be purely coincidental, Watkins added.
Information from Chainalysis additionally point out that after mining swimming pools stopped sending bitcoin to OKEx, their newly minted cryptocurrency as an alternative flowed to Binance and Huobi, each of that are additionally broadly utilized in China.
Binance, Huobi and OKEx in whole obtained 46% of bitcoin despatched to exchanges from mining swimming pools previously 12 months, based on a Nov. 12 report from Chainalysis.
Colin Wu, a journalist primarily based in China who first reported the Chinese language miners’ promoting drawback in his weblog, instructed CoinDesk in a WeChat message that Western media retailers have largely “exaggerated” what he wrote, saying the difficulties Chinese language miners have had promoting bitcoin ought to have had a minor impression on the current value rally.
“The misunderstanding is that Chinese language miners stopped promoting cash and brought on bitcoin to rise, which is illogical,” Wu wrote in a tweet thread. “They didn’t cease promoting cash. … It was just a bit troublesome and the variety of miners in China has been reducing. Miners are shifting to america and Kazakhstan.”