Huobi and Binance on-chain data review in the past two weeks: market confidence has not diminished, and transaction volume has increased
Original title: "OKEx Black Swan is hard to beat the big trend! How much will Huobi and Binance affect after the withdrawal is suspended? "
Original source: Beijing Lianan
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On the morning of October 16, 2020, an announcement by OKEx, one of the "Big Three" exchanges in the digital currency field, caused shock in the industry. And because they do not understand the professional knowledge of wallet management on trading platforms, many people also do not understand concepts such as private keys, and even think that there is a problem with its operation. In fact, what is reflected here is a process rule on the asset management of a trading platform. And the resulting balance of some security and flexibility management. Next, we will conduct an in-depth analysis of this event from multiple angles.
What is the private key? How to distinguish between hot and cold wallets on the trading platform?
Usually, the trading platform adopts the "hot and cold separation" digital currency management method. The "hot" here is the hot wallet. These wallets are always connected to the Internet, responsible for collecting the digital currency charged by users, and also provide users with currency withdrawal services. Usually, when a user initiates a withdrawal application, the trading platform will conduct relevant review work, and then withdraw coins from the hot wallet in batches. For Bitcoin, dozens or even hundreds of user withdrawals will be completed in one transaction at the same time. Coin demand, efficient day-to-day operations.
However, due to the long-term connection of the hot wallet and the online services surrounding the hot wallet, it has also brought security risks to it, and has become an important target for hackers to attack the trading platform.
Previously, in the 7,000 BTC theft incident that occurred in Binance, the stolen bitcoins came from Binance’s hot wallet, but why weren’t all Binance’s bitcoins stolen? "Just" 7,000 stolen? The reason is that trading platforms usually store large amounts of digital assets in their cold wallets. Such wallets are offline most of the time, making it difficult for hackers to attack, which naturally ensures the security of their assets. For example, the current Bitcoin "Rich List" The number one address is Huobi’s cold wallet, which stores more than 200,000 bitcoins, which is usually a reflection of the strength and solvency of the trading platform.
But this time the situation is likely to be that, based on its internal hot and cold wallet management mechanism, as well as the risk control-based authorization mechanism, in the overall or part of the digital currency business process, it is necessary to master some wallets, especially the private key of the cold wallet. Authorization by personnel, but these authorizations cannot be carried out normally, so the withdrawal business has to be suspended.
After this incident, people have turned their attention to the other two of the Big Three: Huobi and Binance. What will happen to these two trading platforms?
In fact, on the day of the incident, we paid close attention to the on-chain transactions of Huobi and Binance. At that time, there was a rapid increase in the outflow of bitcoin from the two major trading platforms. At the same time, the price of digital currencies also experienced a short-term general trend As a top trading platform, the impact of such a black swan event on the market is still obvious.
However, this situation only lasted for half a day, and the data of the two major trading platforms began to It returned to a normal state, and the market quickly got rid of the impact of this incident, and mainstream digital currencies such as Bitcoin and Ethereum also returned to the upward trend that had started at that time. Next, we reveal this process from the dynamic changes of data on the Bitcoin chain.
First look at the most direct data, that is, from one week before the event to this Friday, that is, the event has passed One week later, the bitcoin inflows of the two major trading platforms of Huobi and Binance, the specific date is from October 10th to October 23rd.
Judging from the Huobi trading platform, it is clear that the Bitcoin inflow on October 16, that is, Friday, did not cause users to worry too much about depositing money into Huobi due to the incident at noon that day, and the amount was also at the forefront of the week . Since then, the inflow has begun to decline, but it should be noted that October 17 and 18 are Saturdays and Sundays, which belong to the regular and normal inflow decline period of major trading platforms. In the following week, it was clear that the Bitcoin inflow into the exchange entered a rapid upward trajectory, reaching a recent high on the 21st.
Looking at the year-on-year comparison between Huobi’s bitcoin inflows in the week of the issue and the following week, the event The year-on-year data fell from Saturday to Monday a few days after the release, but rebounded quickly after that, especially on Wednesday and Thursday.
Looking at the final data, the Huobi trading platform inflowed 41729.561 BTC from October 10th to October 16th, and the inflow in the following week 45362.6906 BTC, even an increase of 8.7%.
Here we need to add another background, that is, there was a trend of net outflow of Bitcoin on the centralized trading platform for a long time, one of the reasons is that Defi is popular. In particular, the Bitcoin staking business has absorbed a large amount of Bitcoin from trading platforms. However, entering October, Defi-related tokens plummeted, which also reduced the popularity of this field. At the same time, the prices of mainstream currencies such as Bitcoin and Ethereum have risen, and there have been signs of the return of related digital currencies to trading platforms. From the perspective of the situation, the black swan event of suspending the withdrawal of coins has caused a certain impact, but it has not affected the direction of this general trend.
The trend of Binance is roughly similar, there is no big change on October 16, and the decline in the next two days is The impact of the aftermath of the event + the weekend effect, and then the same rebound, one of the major drivers is also the price of Bitcoin in the past week.
Compared with the same period last year, it is obviously a big trend Winning over the black swan, investors are more willing to put bitcoins on centralized trading platforms for efficient transactions under the upward trend of bitcoin prices.
From the outflow of Bitcoin, on the day of the incident on October 16, the two The trading platforms showed a significant rise, but this trend only lasted for one day, and the panic was quickly digested on the following Saturday and Sunday, and the outflow quickly fell back.
In the second half of the latest week, the outflows of the two major trading platforms rose rhythmically again, due to the rise of Bitcoin The new round of the market will inevitably cause the overall amplification of the inflow and outflow of Bitcoin, which is a normal fluctuation.
At the same time, judging from the past two weeks, the performance of Huobi and Binance users on withdrawal There is not a big difference, especially with the arrival of the bitcoin market in the past week, the overall trend of the two trading platforms is converging. It can be seen that the previous speculation that the incident may trigger users to withdraw coins to foreign trading platforms on a large scale is not valid.
On the whole, the background of this incident is the ebb tide of DeFi and the rise of mainstream currencies such as Bitcoin. The general trend of mainstream currencies returning to trading platforms. At this time, the black swan incident in the big exchange did have a certain short-term impact on Huobi and Binance’s user deposits and withdrawals, especially the performance of withdrawals on the day of the incident. However, it can also be seen from the trend of the data that this impact is short-term. The temporary black swan event may have an impact on the market, but in the end it is the general trend that determines the direction of the market. Both of the two major trading platforms have on-chain transactions in the next week. amount of improvement.
How should users deal with the black swan event
1. Still prefer the top large trading platform to store and trade your digital currency, they With strong solvency, good reputation, and proper security measures, the risk of running away and bankruptcy is much lower than that of small and medium-sized trading platforms. In fact, the suspension of the coin withdrawal incident reflects from another perspective that it has relevant permissions and a series of risk control mechanisms inside, which can better guarantee the security of user assets, but these mechanisms can also cause embarrassing situations under special circumstances.
2. Pay attention to the decentralized management of assets, that is, "don't put all your eggs in one basket". Based on the business characteristics of the trading platform and your daily use needs for related digital assets, the digital assets are scattered and stored in other large trading platforms such as Huobi.
3. For digital assets that will not be traded in the long run, store them in your personal wallet address However, please keep the private key or mnemonic phrase safe, because once lost, it cannot be retrieved. In contrast, centralized trading platforms are safer. After all, you have your real name information to verify, and even if you forget your password, there is a process to solve it.
4. Don’t be influenced by the so-called "regional" view of the trading platform. In fact, some current international transactions Platforms have not obtained compliance licenses in many countries. If extreme events occur, users cannot recover their responsibilities, let alone find their location, and it is impossible to protect their own rights and interests.
This article is from a contribution and does not represent the opinion of Rhythm BlockBeats
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