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CZ Comments on Ominous Bitcoin Data
In a recent statement, Binance CEO Changpeng Zhao (CZ) expressed concerns about the current state of the cryptocurrency market, particularly regarding Bitcoin’s performance. According to him, his gut feeling is that Bitcoin has now become more of a reserve asset and less of a transaction currency due to its high fees and long block times.
This sentiment echoes the recent comments made by Chris Kuiper, director of research at Fidelity’s crypto unit. As reported by U.Today, Kuiper explained that the dominance of Bitcoin ETFs is the key reason why the mempool has become empty. This observation highlights the shift in investor behavior towards holding rather than trading cryptocurrencies.
The statistics support CZ’s concerns as well. According to SoSoValue data, BlackRock’s IBIT alone boasts $57.5 billion worth of net assets. This significant amount of money being tied up in ETFs is not reflected in on-chain transactions, which could be the reason for the lack of activity in the mempool.
CZ’s comment raises questions about Bitcoin’s potential to make a major move in the near future despite its poor on-chain performance. As seen in recent data, Bitcoin has been struggling to regain lost ground after falling short of reaching $100,000 on February 4th and currently trading at around $97,190 according to CoinGecko.
This article highlights CZ’s concerns about the role of Bitcoin as a transaction currency and the potential impact of ETFs on its volatility.
Source: u.today
