- Bitcoin’s price took a slight dip late last week when it was revealed that OKEx had frozen withdrawals.
- The exchange did so as one of its key holders went silent as he was cooperating with a public security bureau.
- Some investors took this as a sign that the cryptocurrency industry was under a regulatory threat.
- Bitcoin didn’t fall as much as some initially thought, though.
- Analysts say that this simple fact that Bitcoin didn’t capitulate on the news suggests that the “exchange FUD” narrative is dead.
- An underlying bid from institutional players may be supporting BTC’s price action.
Bitcoin Not Budging on OKEx News, Other Exchange News Bullish
This past week, OKEx revealed that it had frozen withdrawals of Bitcoin and all other cryptocurrencies. A private key holder that manages withdrawals went offline after he began cooperating with a public security bureau.
Bitcoin proceeded to drop by 2-3% against the dollar. Many thought the asset would drop even further, but it didn’t, with the price staying resolute even into the weekend.
Analysts say that BTC’s inability to dump on this news shows that the cryptocurrency exchange FUD narrative that once captured this industry is “officially dead.”
Qiao Wang, a prominent industry analyst, commented on the matter:
Some perspective: BTC is up about 5% during a 3-week period where Kucoin got hacked, Bitmex executives got charged by regulators, and Okex suspended withdrawals due to investigation. The “exchange FUD” narrative that has haunted this industry for years is officially dead IMO.
https://twitter.com/QwQiao/status/1317626332801617921
As can be seen, he also made reference to other bearish news events for exchanges that barely managed to budge the price of Bitcoin.
These include, Bithumb getting raided by South Korean police at the start of September. KuCoin getting hacked for over $200 million worth of digital assets, most of which were in Ethereum and ERC-20 tokens. And lastly, BitMEX getting charged by the U.S. CFTC over derivatives violations.
Underlying Bid Supporting Price
A reason why Bitcoin may be holding up well is that there is likely an institutional bid that is supporting price action.
Crypto asset analyst “Z” noted that the cryptocurrency exchange Coinbase has been facilitating many buyers of Bitcoin over recent weeks:
“Went through some numbers today: Since the drop from $12k to $10k on September 2nd, Coinbase alone has been a massive net buyer of $BTC. Roughly 40,000 BTC in net buying in that 44 day period. (800 BTC a day).”
This bid is supporting Bitcoin’s price, allowing it to absorb bearish news events without a massive red candle on its chart.
Went through some numbers today:
Since the drop from $12k to $10k on September 2nd, Coinbase alone has been a massive net buyer of $BTC.
Roughly 40,000 BTC in net buying in that 44 day period. (800 BTC a day). pic.twitter.com/2BJxQiqg3N
— Zaheer (@SplitCapital) October 16, 2020
Photo by Dikaseva on Unsplash Price tags: xbtusd, btcusd, btcusdt Charts from TradingView.com "Exchange FUD" Narrative That Haunted Bitcoin May Finally Be Dead: Analyst
