The revenue frenzy has led to massive withdrawals from Ethereum and Tether in China

The ongoing onslaught of yield farming in the crypto market has reportedly led Chinese investors to withdraw funds from exchanges in the country to tie them to obscure protocols that promise high yields, the local outlet said WuBlockchain earlier today.

In China, Ethereum withdrawals are increasing

Colin Wu, a reporter focused on the local blockchain and cryptocurrency sectors in China, said Sept. 6 that “many exchanges in China have had difficulty withdrawing and closing coins.”

Breaking: On September 6, many exchanges in China struggled to withdraw and close coins. The Chinese community is starting a “coin withdrawal campaign” demanding that all USDT and crypto data be exchanged and their accounts deleted.

– Colin Wu (WuBlockchain) (@ WuBlockchain) September 7, 2020

He claimed this was due to the Chinese crypto community pulling out massive amounts of liquidity and transferring Tether and other altcoins worth millions of dollars to raise agricultural projects like Yearn Finance and SushiSwap.

Wu backed the claim with data from CryptoQuant, an on-chain analytics company. He said the recent drop in prices this weekend drove investors to do so buy the dip and then transferred to decentralized exchanges like Uniswap to exchange with other tokens.

The data shows that due to the popularity of high-yield farming, particularly the recent sharp drop in ETH prices, many users buy bottoms on exchanges and then switch to farming to DEX. The stock of ETH and other farm cryptos on the stock exchange is falling rapidly.

– Colin Wu (WuBlockchain) (@ WuBlockchain) September 7, 2020

The data showed that exchange reserves – or the number of cryptocurrencies that were available for trading on an exchange at any given point in time – saw a significant decline. The hardest hit were Bitfinex and Kucoin, two popular crypto exchanges.

Wu added in a follow-up tweet:

“The ‘withdrawal movement’ is widespread, but the real impact is uncertain. Exchanges are also starting to defend themselves, such as a crazy listing of DeFi coins to get users to gamble in the secondary market and to help users with income farming. “

DeFi’s “crazy” rush

Wu’s comment came when Crypto Exchange Binance launched its “Launch Pool” service on Sunday in an attempt to generate returns on its BNB token. In an announcement, Binance said that BNB holders who choose Launch Pool will automatically receive interest in projects that issue their tokens on the Binance chain, starting with the Bella Protocol yesterday.

“We’re excited to host @BellaProtocol as Launchpool’s first #DeFi offering on the Binance platform, and we’re excited to provide #Binance users with the ability to securely manage new assets.” – @cz_binance

– Binance (@binance) September 6, 2020

The rush for DeFi listings and productive agriculture has skyrocketed over the past month, with projects jailing hundreds of millions at launch, reminiscent of the infamous 2017 ICO bubble.

Ethereum is still the blockchain choice among issuers. According to CryptoSlate’s data page, the top 15 DeFi tokens and projects are working on the Ethereum network locking up billions of dollars.

Image: CryptoSlate

As a result, the activity has immensely congested and strained the network, and fees have soared to over $ 60 per transfer.

And that might just be starting, especially if the market is attracting billions of dollars from new users in China.

Get one Edge on the cryptoasset market

Access more crypto insights and context in every article as a paid member of CryptoSlate Edge.

On-chain analysis

Price snapshots

More context

Sign up now for $ 19 / month. Discover all the advantages Protect your wealth: Invest in a Crypto Index Fund

Do you like what you see? Subscribe to updates.

Comments are closed.