Bitcoin touches $21,000 as cryptocurrency industry continues to face woes

For the first time since the FTX collapse last year, the cryptocurrency industry perhaps breathed a sigh of relief. This was due to Bitcoin (BTC) which briefly surpassed $21,000 last week. BTC is currently trading at $20,800 (at the time of publishing the story) after a slight retracement early on Sunday. “The majority of exchange-purchased Bitcoin was quickly withdrawn, and $255 million worth of Bitcoin was placed in self-custody,” Dhruvil Shah, senior vice president, technology, Liminal, a digital wallet infrastructure platform, told FE Blockchain.

This comes on the back of several news reports of CoinDCX laying off about 80-100 staffers. Not to mention, the industry in the last year has seen several shutdowns besides the FTX scandal. 

According to data from Coinglass, a cryptocurrency trading information platform, the cryptocurrency market recorded liquidation worth $721 million in the last 24 hours. A total of 132,021 traders liquidated, with a $6.84 million short bet against Bitcoin being the largest liquidation. “Ethereum is gaining momentum and it is going strong. The US consumer price index (CPI) data released on January 12, 2023, confirmed the thesis that inflation was continuing to drop,” Shrikant Bhalerao, co-founder, Seracle, noted.

Bitcoin: Net transfer volume. Source: Glassnode

Interestingly, even though there have been many Bitcoin purchases over the last day, the amount of Bitcoin leaving exchanges reached a record-early high for the year. “The unwinding of long positions held in cryptocurrency has the opposite effect on short positions held in USD. July 2021 saw Binance and USD-denominated futures,” Shah noted.

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