FTX fallout spurs exchange withdrawals and crypto wallet downloads. The failure of FTX has served as a wake-up call for holders of cryptocurrencies. Who had become a little too accustomed to the concept of entrusting their tokens. To a third party and letting that party do whatever it wants with them. The failure of FTX has served as a wake-up call because cryptocurrency holder. Had become a little too accustomed to the concept of entrusting their tokens to a third party
Anyone who has been involved in the cryptocurrency space for a number of years. That can attest to the fact that the concept of “not your keys. Not your crypto” used to be more widely discussed and adhered to in the past. This is something that can be confirmed by anyone who has worked with cryptocurrencies.
The development of cryptocurrency lending and the potential to make a return on assets. That are kept on exchanges proved to be too attractive for many hodlers to pass up. And as a result, many hodlers sold their cryptocurrencies. As a direct consequence of this, these bitcoin hodlers agreed to hand over control of their holdings. In exchange for a relatively meager payment.
Terra/Luna Implosion
Unfortunately, the events of 2022, beginning with the implosion of Terra/Luna and. More recently, the collapse of FTX, have reminded crypto holders. Both new and old, of the reason many got into cryptocurrencies. In the first place – the ability to self-custody their assets. This is true for crypto holders of both new and old generations. That is something that should be kept in mind by both new. And experienced holders of cryptocurrency.
Even though there is not much that those who had assets locked up. In either Terra or FTX can do at this point to retrieve their funds. Other than wait for bankruptcy proceedings to play out. The community as a whole has gotten the message that their cryptocurrency is safest. When it is in a wallet that they control. This is the case despite the fact that there is not much that those who had assets locked up. In either Terra or FTX can do at this point to retrieve their funds. Those who now have cryptocurrency will be pleased to hear this news.
Since the FTX drama began in early November, cryptocurrency exchanges have., With the exception of November 17, seen considerable withdrawals of Bitcoin, according to information that was provided by CryptoQuant. This trend has continued ever since the beginning of November.
Ethereum shows a Similar Pattern
A trend that is very similar to the one that was described before can be seen on the chart for Ethereum. This is evidence that self-custody is. In fact, undergoing a renaissance across the whole cryptocurrency ecosystem.
This is further confirmed by statistics provided by Finbold. Which shows that an estimated 102.06 million crypto wallets were downloaded. For Android and iOS smartphones between January and October of 2022. This span of time covers the period of time in question. The time period in question is encompassed by this particular time span. This number was arrived at by doing an examination of the 21 applications. That have the largest market share when it comes to holding digital money.
Wallet Downloads were Trending Down
In spite of the fact that this number is lower than the 177.85 million downloads. That took place during the bull market of 2021. It is still more than three times as many as any previous year.
The data, when broken down by month. Shows that wallet downloads have been on a downward trend. Since the beginning of the year, with the exception of a brief uptick in May. Which was the month that the Terra/Luna exchange failed. Other than that, however, wallet downloads have been on a downward trend since the beginning of the year. Wallet downloads, on the other hand, have been seeing a general decrease trend. Since the beginning of the year, despite this one exception.
June through August is Typical of Bear Market Period
Traders have a tendency to stay away from the market totally when valuations are declining. Which is what caused the calm that was observed in the market from June until August. Bear market periods are typically characterized by calm market conditions.
Even though it’s too soon to get a complete picture of the increase in wallet downloads. For the month of November, data provided by Similarweb shows a common pattern indicating a spike. In the usage score for some of the top cryptocurrency wallets. Such as the Enjin wallet or the Exodus wallet. This is despite the fact that it’s too soon to get a complete picture of the increase. In wallet downloads for the month of November. This suggests that a growing number of individuals are downloading these wallets and making use of them.
Before FTX Filed for Bankruptcy
This surge, which occurred around November 10 across all of the charts that were reviewed. Took place the day before FTX filed for bankruptcy. This surge was consistent across all of the charts that were analyzed
Josef Tetek, who works as a Bitcoin analyst for the business Trezor. Which is a developer of bitcoin hardware. Provided additional proof of the rush toward self-custody of cryptocurrencies. Tetek provided this evidence in the form of a statement. Tetek has provided us with a statement that we can go to in order to access this material.
During a discussion that took place between Kitco Crypto and Tetek and FTX Fallout. The industry professional made the observation. That there has been a discernible increase in the number of purchases of Trezor. As a direct result of the uncertain market that has been taking place this year.
Tetek claims that over the course of the previous several months. They have witnessed a discernible increase in the total amount of interest in Trezor products. “An increasing number of individuals are coming to the comprehension. That it is to their benefit to keep their coins about them at all times.”
Trezor’s sales matched last year’s bull market
While the price of cryptocurrencies were falling to new lows as a result of the repercussions. From FTX, Trezor experienced an avalanche of purchases that was comparable. To what the firm saw during the bull market of the previous year.
“Our sales in the weeks following the FTX collapse are comparable to a year ago. When the bitcoin price was hovering around its historic highs,” Tetek stated. “Our sales in the weeks following the FTX fallout collapse are comparable. To what we saw in the weeks following the FTX collapse.” “A bear market is typically a pretty quiet period for us. Therefore, this rise in sales just demonstrates how significant an impact the collapse of FTX fallout. Has on people’s mistrust in custodians.”
And with the FTX contagion still working its way through the cryptocurrency ecosystem. As evidenced by the announcement that the cryptocurrency lender BlockFi filed for bankruptcy protection on Monday. Citing its exposure to FTX fallout – there is a good chance that “not your keys, not your crypto.” Will once again become the mantra of the crypto faithful. This is due to the fact that the FTX contagion is still working its way. Through the cryptocurrency ecosystem.
