Crypto crashes and various crypto exchanges making the headlines in 2022 for either filing for bankruptcy or halting withdrawal services. The very recent incident has been the FTX fiasco. However, the repeated incident of FTX and Voyager has also set the market sentiment for what the crypto space is more likely to curve towards.
The FTX collapse has raised a lot of questions from investors regarding unregulated exchanges. Investors are now questioning the safety of one’s funds on one of these centralized exchanges and have also voiced grave concerns about the centralized decision-making which does not really have any checks in place. This has pushed investors to move their funds and crypto into DeFi platforms. Furthermore, there has been a couple of recent reports suggesting that looking at the downfall of numerous crypto exchanges that have taken place over the last decade has permanently taken 1.2 million Bitcoin, which comes to almost 6% of all Bitcoin available in the 21 million, out of circulation. BTC is currently running with a value of $16,200.25 as of 12:44 pm, November 28, 2022.
Moreover, the disclosure of certain malpractices by the FTX exchange has also resulted in causing panic among investors. The exchange outflows have seen historic highs of close to 106,000 BTC per month in the wake of the FTX fiasco, according to Cointelegraph reports. The whole fiasco has churned out an extensive loss of trust in centralized exchanges, also referred to as CEXs, and has pushed investors toward self-custody and decentralized finance (DeFi) platforms.
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