Leading cryptocurrency exchange KuCoin announced this week that it is reducing its holdings of key assets, including Bitcoin, Ether and the stablecoin USDT. According to that certificate’s latest proof of reserves, assets have fallen 3-4% since August as some users withdrew their funds from the platform.
Data from analytics provider Defillama confirmed this trend, recording $118 million in net outflows from KuCoin last month. The drain points to a decline in customer confidence due to unsettled markets and changing regulatory landscape.
Kokoin released the latest asset reserve certificate (29-9). The user’s BTC holdings were 17,617.5, down 4% from last time (31-8). User ETH holdings were 148,125, down 3%. USDT user assets were 837 million, which was 4% less than last time.
Bitcoin reserves fell by 4%
KuCoin’s certificate of deposit showed that its bitcoin reserve fell by around 4% in September to more than 17,600 BTC. Ether holdings fell 3 percent to about 148,000 ETH, while USDT reserves fell 4 percent to about $837 million.
These reductions coincide with the extreme volatility of cryptocurrency markets in 2022. Skate investors tend to shift assets to stablecoins or foreign wallets during periods of uncertainty.
Additionally, the tightening of regulations on crypto exchanges around the world has some users panicking. While generally small, sustained outflows of funds pose risks to exchange viability and market stability.
However, the climate suggests that exchanges like KuCoin need to take proactive measures to strengthen trust. Regular certificates provide a way to represent debt through certificates of deposit.