BTC HODLers and investors are becoming increasingly wary of centralized exchanges in the wake of last week’s FTX collapse. Hardware wallet provider, Trezor, reports a 300% surge as investors are increasingly moving to hardware crypto wallets.
BTC HODLers have been transferring their funds away from exchanges and into self-custody wallets during the past week or two. According to analytics service Glassnode, there has been the largest increase in on-chain wallet activity in Bitcoin history.
In its ‘Week On-chain’ published on Nov. 14, Glassnode reported that exchanges have seen one of the largest net declines in aggregate BTC balance in history. The amount of BTC on them fell by 73,000 in just seven days. Outflows of more than 106,000 BTC per month have only been witnessed in April and November 2020, June/July 2022, and now in November 2022.
The moves are hardly surprising considering that FTX, the world’s second-largest exchange, was considered pretty much bulletproof. The collapse of the exchange proves that it was not too big to fail, especially if it didn’t have the reserves to cover the bank run that occurred.
Despite the fact that several of the biggest exchanges, including Binance and Kraken, have offered proof-of-reserves, cryptocurrency investors are still wary of them.
The opposite has happened with stablecoins which have been flowing onto exchanges over the past week or so. Last week, the total value of stablecoin reserves held by all exchanges reached a new record high of $41 billion. Supplies and reserves for Circle (USDC) and Tether (USDT) have slightly decreased, while Binance USD (BUSD) has increased as the exchange combines its reserves. Glassnode observed that a lot of these stablecoins have been withdrawn from smart contracts at a rate of $4.63 billion per month.
Trezor Sees 300% Surge in Sales Revenue Due to FTX Saga
In the wake of the FTX epidemic, major hardware wallet supplier Trezor has seen a significant increase in wallet sales, the company’s brand ambassador Josef Tetek said on Nov. 15.
Tetek said that Trezor’s sales income increased 300% week over week and are continuously rising, and that current sales are more than they were a year ago, when Bitcoin hit an all-time high of $68,000. The executive pointed out that Trezor has also seen a large boost in website traffic, which rose 350% during that time.
Tetek claims that Trezor is confident that the increase in new wallet users was caused by problems with FTX, a cryptocurrency exchange at the core of the most recent industry crisis involving the theft of customer assets. Trezor expects further growth in new users in the near future as the failure of middlemen in crypto would only continue to unfold, Tetek suggested, stating: