Cryptocurrency investors are reluctant to cooperate with cryptocurrency trading platforms, which has resulted in sinking currency reserves of Bitcoin and Ethereum. Centralized Bitcoin and Ethereum exchanges hit historic lows after investors and cryptocurrency enthusiasts turned to self-custody solutions for their virtual assets.

Stay away from cryptocurrency trading

A recent trend has shown that traders and other enthusiasts prefer to hold their crypto assets rather than sell them Bitcoin and Ethereum exchange platforms.

They preferred direct ownership of their assets through self-care portfolios, which created a growing demand for self-care solutions. However, this led to a decline in BTC and ETH liquidity on centralized exchanges.

Strengthening the value of Bitcoin and Ethereum

A positive consequence of traders’ preference for self-custody solutions is the increasing value of Bitcoin and Ethereum assets over time. Traders moving away from cryptocurrency trading platforms create a feeling of scarcity, which leads to an augment in its value.

At the time of writing this text, Bitcoin price is set at $64,842. Since hitting a record high of $73,000 in March of this year, the price has remained between $66,000 and $49,000. Meanwhile, according to Coinmarketcap, Ether is listed at $2,464.

Bitcoin and Ethereum reserves decline

Bitcoin and Ethereum based on centralized reserves fell and hit historic lows earlier this month. From October 13 CryptoQuant Chart showed that centralized BTC exchanges recorded an all-time low of 2,666,717 bitcoins.

The highest number of Bitcoins was set at 3,361,854, which was recorded on June 8, 2022. After this period, the price of Bitcoin dropped sharply. It hit a low earlier this month.

In terms of volume, spot exchanges hold 1.1 million Bitcoins in reserves, while derivative exchanges hold 1.39 million reserves. By far, Binance has 563,000 Bitcoin reserves, which is the largest cryptocurrency exchange in terms of trading volume, followed by Kraken with 112,3000 reserves.

On the other hand, Coinbase Advanced has 830,530 Bitcoin reserves and Coinbase Prime has 3,000 reserves. Centralized Ethereum exchanges are also facing a similar dilemma to Bitcoin, with its reserves continuing to decline and reaching a record low of 18.7 million.

According to CryptoQuant, exchange of derivatives holds a vast share of Ethereum with 10.3 million reserves, while 8.4 million Ethereum reserves are held on spot exchanges.

Historically, the highest ever Ethereum reserve was 2,310,823 recorded on September 6, 2022. Since then, Ethereum reserves on central exchanges have continued to decline.

In terms of reserves, Coinbase has a vast reserve of 4.5 million Ethereum, followed by Binance with 3.6 million Ethereum. Kraken also has a significant Ethereum reserve of 1.3 million.

Featured image from Pexels, chart from TradingView