- Bitcoin halted its decline amid news from Binance.
- Investors withdrew almost a record amount of BTC from exchanges.
- Crypto funds raised the most money in three months.
- Elon Musk said the crypto-zine could be a long one.
- The U.S. Treasury Department has promised to tighten controls over the crypto market.
Bitcoin halted its decline amid news of Binance’s launch of a fund to help troubled cryptocurrency companies. However, attempts to correct it were unsuccessful.
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Investing in crypto funds
According to CoinShares, investments in crypto funds rose last week to their highest level in three months. Inflows of $42 million compared to outflows of $16 million a week earlier. Investments in bitcoin grew by $19 million; in Ethereum by $3 million. Investments in funds that allow opening shorts on bitcoin increased by $13 million. Altcoin basket products attracted the maximum since June of $8 million. Investors saw the FTX collapse as an investment opportunity, CoinShares noted.
BTC withdrawals from cryptocurrency exchanges
According to Glassnode, BTC withdrawals from cryptocurrency exchanges reached an all-time high of 106,000 BTC for the month. Previously, the market has experienced a similar BTC outflow only three times in history.
Binance CEO Changpeng Zhao and MicroStrategy founder Michael Saylor urged users to keep assets in cold wallets, especially during “market turbulence.” According to Bloomberg, FTX customers are unlikely to get their funds back.
Crypto-winter could be a long one
Elon Musk said that the crypto-winter may be long, but bitcoin will survive in the end. In addition to the head of Tesla, the president of El Salvador, Nayib Bukele spoke in support of BTC. According to him, BTC is the opposite of FTX and was created precisely to prevent “Ponzi schemes” and similar bankruptcies.
The collapse of FTX
The collapse of FTX showed that the cryptocurrency industry needs “very careful regulation,” said U.S. Treasury Secretary Janet Yellen. The consequences of the incident could have been much worse if the crypto market had been more connected to the traditional financial system, she said.
The FTX bankruptcy could have permanently undermined institutional investors’ confidence in cryptocurrencies. As Shark Tank host Kevin O’Leary said, institutionalists are demanding asset protection from U.S. authorities.
According to Cumberland DRW, the collapse of FTX will affect the structure of the crypto market. Cryptocurrency services will face clear specialization and regulation, and assets and capital will not be placed on centralized exchanges