Bitcoin's exchange supply has plummeted to its lowest level since February 2018, according to data analytics firm Santiment.
Amid lawsuits by the U.S. Securities and Exchange Commission (SEC) against major cryptocurrency exchanges Binance and Coinbase, traders are moving their bitcoin to self-custody, potentially in a bid to insulate themselves from regulatory uncertainty.
As long as these damning lawsuits continue, Santiment predicts this trend will continue to persist.
The U.S. Securities and Exchange Commission (SEC) has accused two big crypto exchanges, Binance and Coinbase, of not properly registering their operations, among other claims.Binance, including its affiliate BAM Trading, is alleged to have been running without needed permits since 2017 and is also accused of selling unregistered crypto assets. Binance's founder, Changpeng Zhao, is also claimed to have created a way to sidestep U.S. law, allowing Americans to use Binance.com. Coinbase is also accused of operating without the right registration since 2019, which the SEC says has denied investors necessary protections.
These legal troubles for Binance and Coinbase mark an escalating crackdown on cryptocurrency exchanges by regulatory authorities.
As a result, a shift in trader behavior is evident with a significant movement of bitcoin to self-custody, indicating a rising trend of self-preservation among cryptocurrency investors amid regulatory uncertainties.