As Analysts Determine, OKEx’s Withdrawal Suspension Isn’t The Reason Behind Bitcoin’s Rally
Analysts see no connection whereas as OKEx announced the suspension of the crypto withdrawal service, the price of Bitcoin has been up. What are the reasons leading to this phenomenon? Hear what crypto enthusiasts have to say
OKEx Suspends Crypto Withdrawal
Here we find that the very day the popular exchange OKEx had announced the suspension of all those crypto withdrawal services on its platform, the bitcoin’s price has been up dramatically. Many market observers do not see a reason to associate the latest price rally with OKEx’s issues, however, while some tie the two together.
After OKEx’s suspension on all crypto withdrawal came bitcoin’s latest rally.
The most recent bullish run began just as OKEx said it suspended all crypto withdrawals because one of its key holders thereafter has been out of touch while the price of bitcoin there has now gained significantly ever since the market sell-off happening in March.
According to Ki Young Ju, chief executive officer of CryptoQuant, having little impact on bitcoin’s price over the past month was however the suspension of withdrawals on OKEx.
He then said that not that different from other exchanges is BTC’s price on OKEx. Despite the withdrawal suspension, people can trade their BTC on OKEx.
There was an observation as the data source Skew, tells about the Malta-based crypto exchange remaining the No.1 position for bitcoin futures open interest currently worth $1.22 billion.
After founder Mingxing Star Xu was said to have been released from police custody in China, OKEx said Thursday, it will resume withdrawal service as soon as this week. Its high open interest is a positive indicator for his company as Jay Hao, a chief executive officer of OKEx says.
Through a spokesperson on Telegram, Hao said that they will soon come back to OKEx, as these are encouraging signs that confidence in the exchange now remains, high believing that even if some users decide to withdraw their funds as soon as withdrawals come to be open that comes as their total and absolute right.
Decreased Chinese Miners’ Impact On Prices
Subsequently, it was shown that data from Glassnode tells, the bitcoin’s volume from those miners to OKEx has also dropped to almost zero since the news came out.
In line with the argument that the price surge is partly due to drying up in supply, is the muted bitcoin transfer volume from miners to OKEx, whose users are largely Chinese. Due to a government crackdown on Chinese exchanges, miners in China are struggling to turn their bitcoin into cash.
Saying that instead of going to other platforms, miners may have been holding on to their bitcoins as prices continue to climb causing a tightened bitcoin supply as Darius Sit, founder of Singapore-based trading firm QCP connects the situation for miners in China with the market.
Saying the supply of bitcoin affected by OKEx’s withdrawal suspension is relatively small, yet others have largely disagreed with such contentions.
In a Telegram message, Ryan Watkins the bitcoin analyst at Messari was saying that miners aren’t that large a group of sellers as a class. As high as it is, they are definitely not enough to drive the price up
As institutional investors in North America have been buying bitcoin in large amounts, instead Watkins pointed out the recent bitcoin rally to be mostly driven by the demand side.
Watkins added that it could be purely coincidental with the perfect timing of OKEx’s suspension and the price rally.
Their newly minted cryptocurrency instead flowed to Binance and Huobi both of which are also widely used in China as data from Chainalysis also indicate that after mining pools stopped sending bitcoin to OKEx.
There was a view that a Nov.12 report from Chainalysis has that Binance, Huobi, as well as OKEx in total, received 46% of bitcoin sent to exchanges from mining pools in the past 12 months.
Finally, As We Conclude On It
In a WeChat message, Colin Wu who was the journalist based in China reporting the Chinese miners’ selling problem first in his blog was saying that the difficulties Chinese miners have had selling bitcoin should have had a minor impact on the recent price rally whereas the western media outlets have largely exaggerated what he wrote.
In a tweet thread, Wu wrote that Chinese miners stopped selling coins and caused bitcoin to rise which is illogical as the misunderstanding comes to be. It came to be just a little troublesome as the number of miners in China has been decreasing, and they did not stop selling coins with the miners moving to the United States and Kazakhstan.
This is where the importance of Bitcoin comes to be noticed. Whatever be the reason, bitcoin is here to stay. Miners dig out newer ways to keep up the mining process. So what now? Hear us for more on the latest report of the matter.