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Exchanges Strengthen Bitcoin Insurance Funds After Halving Sales

May 11, 2020

After a sharp decline in Bitcoin’s (BTC) value on May 10 – just before halving block rewards for network miners – Various exchanges hurried to provide liquidity to their BTC insurance funds.

Early today Binance revealed yesterday had used “over 13,000,000” tether (USDT) to protect traders from self-de-leveraging risk (ADL) on their platform.

“We will add an additional USD 30,000,000 to the insurance fund in addition to the USD 7,500,000 on April 30,” the exchange said.

Exchanges Strengthen Bitcoin Insurance Funds After Halving SalesExchanges Strengthen Bitcoin Insurance Funds After Halving Sales

The exchange’s insurance fund portfolio for BTC / USDT contracts fell from $ 21,005,925 on May 10 to only $ 7,731,989 on May 11.

In response to a request from Cointelegraph, Binance declined to comment beyond its official public announcement on social media.

The impact on the entire stock exchange sector

New data for the Bitcoin derivatives exchange Deribit show that insurance fund balances have remained relatively stable and decreased only slightly from today’s 501.96 BTC on May 9 to 498.99 on May 11.

However On May 10, there was a significant 386 bankruptcy among traders, up 565% from the previous day.

Deribits BTC insurance balance sheet charts, May 11th

Deribit BTC Insurance Balance Charts, May 11th. Source: Deribit

At the OKex crypto exchange, 31.67 BTC was paid into the BTC / USD futures insurance fund on May 10, and 35.1 BTC was withdrawn immediately afterwards to cover a registered insolvency loss.

Huobi’s insurance fund declined from 1,536 BTC on May 9 to 1,418 on May 10, slightly increasing to 1,431 at press time. Unlike OKex, Huobi does not provide a breakdown of the data that would show the pattern of withdrawals and deposits for your fund.

On the trading platform for cryptocurrency derivatives BitMEX, the daily insurance fund of the exchange fell only slightly between May 9 and 10 from BTC 35,760 to BTC 35,374. At the time of going to press, his account balance still needs to be updated by March 11, which limits understanding of the impact of BTC’s price path on merchants.

By halving bitcoin just around the corner, the major currency has managed to break the USD 8,800 resistance level and is trading at $ 8,914 at press time, according to the Cointelegraph Bitcoin Price Index.

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