Bitcoin Worth $1.2B Leaves Coinbase in a Sign of Persistent Institutional Adoption

Coinbase outflows represent continued institutional adoption of bitcoin as a macro asset, analytics firm Glassnode said.

AccessTimeIconMar 15, 2022 at 10:43 a.m. UTC
Updated May 11, 2023 at 4:38 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global event for everything crypto, blockchain and Web3.Register Now

While bitcoin's (BTC) four-month bearish price action appears to have scared away retail leverage traders, institutions focused on longer-term horizons seem unperturbed.

That's evident from the recent large outflow of coins from the U.S.-based crypto exchange Coinbase (COIN), according to blockchain analytics firm Glassnode.

  • A total of 31,130 bitcoin left Coinbase last week, the highest single-week outflow since 2017, data tracked by Glassnode shows.
  • "Large outflows like this one are actually part of a consistent trend in the Coinbase balance, which has been stair-stepping downwards over the last two years," Glassnode said in a weekly newsletter published Monday. "As the largest exchange by BTC balance, and a preferred venue for U.S. based institutions, this further supports the adoption of bitcoin as a macro asset by larger institutions."
  • The past week's outflow has pushed the number of coins held on the Nasdaq-listed exchange to a four-year low of 649,500 BTC. The balance held across all centralized exchanges has dropped to 2,519,403 BTC, the lowest number since November 2018.
  • The declining exchange balance means fewer coins are available for liquidations on the exchange. In other words, the sell-side liquidity is drying up, suggesting scope for a sharp move on the higher side, especially as the coins withdrawn from Coinbase were moved to a largely inactive wallet.
  • "If we look at the Illiquid Supply Shock Ratio (ISSR), we can see a significant uptick this week, suggesting that these withdrawn coins have been moved into a wallet with little-to-no history of spending," Glassnode said.
  • Bitcoin was last seen trading near $38,600, representing a 2% drop on the day.
Bitcoin's illiquid supply shock ratio (Glassnode)
Bitcoin's illiquid supply shock ratio (Glassnode)

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Omkar Godbole

Omkar Godbole is a Co-Managing Editor on CoinDesk's Markets team.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.