Crypto Report Says ‘Alameda Gap’ Is Gone After Bitcoin Rally, What This Means
March 19 2024 - 2:00PM
NEWSBTC
In its most recent research newsletter, crypto research firm Kaiko
alluded to an ‘Alameda Gap,’ which has been massively impacting the
Bitcoin and crypto market for some time now. However, that seems to
be in the past, as Kaiko stated that the gap no longer
exists. What The Alameda Gap Is About According to the
report, the ‘Alameda Gap’ is the gap in liquidity that existed
after the collapse of the collapse of the defunct crypto exchange
FTX and its sister company Alameda Research. Alameda was one of the
most prominent market makers then and provided massive liquidity to
the market. Related Reading: Is Ripple Behind The XRP Price
Crash? Massive Selling Spree Sparks Concern Following Alameda’s
collapse, this liquidity gap is said to have persisted as market
makers “waited on the sidelines for sentiment and trading activity
to recover.” Now, the market looks to have moved past this, as
Kaiko revealed that, as of last week, the market depth has almost
fully recovered and is back to its pre-FTX average. The
research firm added that the Bitcoin 2% market depth is up 40%
year-to-date (YTD) and briefly surpassed its pre-FTX average of
$470 million. This increase is said to have been mainly due to the
surge in Bitcoin’s price, which has risen faster than the market
liquidity since the SEC approved the Spot Bitcoin ETFs in
January. Bitcoin is up about 50% YTD and has already hit new
highs since the beginning of the year, including a new all-time
high (ATH) of $73,750. Meanwhile, the improvement in liquidity is
also evident in the fact that the cost of trading has declined on
the three major US crypto exchanges: Coinbase, Kraken, and
Bitstamp. How Bitcoin Is Outperforming Gold Kaiko also
highlighted in its report that the Bitcoin-to-Gold ratio, which
measures both assets’ relative performance, is inching closer to
its ATH, which it last hit in November 2021. Interestingly, this
increase means that BTC is outperforming Gold, even though both
assets have recorded ATHs these past few weeks. Related
Reading: Solana Surpasses Ethereum In Major Metric Amid Surge Above
$200 Furthermore, funds linked to these assets show how Bitcoin has
outperformed Gold. Kaiko noted that Bitcoin ETFs have attracted $11
billion since they launched in early January. Meanwhile, the
largest physically-backed Gold ETFs (SPDR Gold Shares (GLD) and
iShares Gold Trust (IAU) have registered outflows during the same
period. Kaiko suggested that this could mean that investors
were moving towards Bitcoin as the “new global store of value.”
Interestingly, the CEO of Jan3 and Bitcoiner, Samson Mow, while
giving reasons why Bitcoin will hit $1 million, also mentioned that
people will start demonetizing Gold and substitute it for BTC at
some point. BTC price falls to $62,700 | Source: BTCUSD
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