Markets

Regional bitcoin supply shifts from the US to Asia

The change in regional supply of Bitcoin is centered around from the United States to Asia. A clear shift can be seen as US federal regulators ramp up their efforts to crush the industry.

Crypto companies are not the only entities leaving the United States. Bitcoin investors also seem to be heading to Asia as Uncle Sam tightens the screws on digital assets.

According to data from the on-chain analytics platform Glassnode, the regional supply change year on year made a difference. A split emerged between supply held according to trading hours in the US and Asia, as noted on May 9.

The data indicates that “coins previously located in the United States continue to be transferred to wallets located in Asia,” Glassnode noted.

The contrast is stark. US supply change year on year decreased by 7.5%, while Asian supply change increased by 6.9%.

Bitcoin regional supply change. glass

Bitcoin leaving US shores?

The divergence started in the first half of 2022. Looking at the chart shows that it was around the time the Terra/Luna ecosystem collapsed. The split has accelerated since then and shows no signs of reversing.

The geographic shift in Bitcoin supply is likely a direct result of the crackdown on cryptocurrency exchanges and wallet providers in the United States.

The outline can also symbolize a shift in geopolitics. Over the past year, the United States has become increasingly hostile to cryptocurrency, while Asia is opening up to the industry.

Coinbase, America’s largest cryptocurrency exchange, has signaled its intentions to move offshore. The decision follows a threat from the Securities and Exchange Commission to take enforcement action.

Moreover, Gemini also stated that it will open an overseas exchange after regulatory scrutiny. Bittrex closed its US operations in March and filed for Chapter 11 bankruptcy protection this week after an April SEC action.

On May 9, two of the world’s largest market makers said they had halted plans to trade cryptocurrencies in the United States. Jane Street Group and Jump Crypto cited regulatory uncertainty in their decisions, with the latter considering moving offshore.

Cryptocurrency mining campaign

The pressure on US cryptocurrency miners is also likely to lead to them moving to friendlier jurisdictions.

When China banned bitcoin mining, America became the beneficiary, but this did not seem to last long. The Biden administration has proposed a 30% energy tax on bitcoin miners which would make operations more expensive than they already are.

The net result is likely to be a wasteland of talent, technology, assets and innovation in digital finance if Uncle Sam continues his war on cryptocurrency.

Disclaimer

Adhering to the Trust Project’s guidelines, BeInCrypto is committed to providing unbiased and transparent reporting. This news article aims to provide accurate and timely information. However, readers are advised to independently check the facts and consult with a professional before making any decisions based on this content.

Leave a Reply

Your email address will not be published. Required fields are marked *