- Bitcoin transaction fees increased, surpassing 2022 levels.
- Coinbase and Binance balances fell as the market greed dropped.
Although exempted from the U.S. SEC hammer, Bitcoin’s [BTC] response to the torrid regulatory landscape has become increasingly complex. As a result of the lawsuit served to Coinbase and Binance, total transaction fees have been rising.
Read Bitcoin’s [BTC] Price Prediction 2023-2024
According to Glassnode, BTC’s transaction fees rose to 15.6 BTC. The last time this happened was at the height of Bitcoin Ordinals adoption, which caused clogging in the network. Regarding exchanges, transaction fees rose unusually in 2022 when FTX collapsed as well.
FTX Implosion: 12.3 BTC
Inscription Mania: 41 BTC
Binance and SEC Regulations: 15.6 BTC pic.twitter.com/Z8HaZeQpkg
— glassnode (@glassnode) June 10, 2023
Usually, Bitcoin transaction fees fluctuate. However, the metric notably increases when the market is in bull season. But in cases like the SEC scrutiny, market participation increased. Thus, this increased demand meant that validating new blocks would have taken more computing power.
While SEC’s regulatory actions impacted Bitcoin exchange fees, another key area that could have affected the hike was the Bitcoin fear and greed index.
Moving toward unease
Historically, unfavorable development in the market leads investors to take rash decisions — sometimes out of fear. Other times, greed. Here, the SEC lawsuit sent panic across the ecosystem.
Consequently, this impacted the fear and greed index, which was around 52 before the regulator’s revelation. At the time of writing, the metric fell closer to the fear region at 47.
Extreme fear here suggested that most investors were worried, and this could offer a buying opportunity. But when it’s in the greed region, it suggested that the market could be due for a correction.
However, at 47, the fear and greed index looked rather neutral. Hence, the value meant that the overall sentiment toward the coin was relatively between optimism and gloom at press time.
Exchanges are still in the battle to recover
Coinbase and Binance have continued to feel the effect of the SEC pressure. Although exchange outflows seem to have reduced from the initial announcement, net position change on Coinbase remained negative at -23, 906 BTC.
The metric considers the 30-day net balance by calculating the difference between exchange inflows and outflows.
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When the balance is negative, it means the outflows outweighed the inflows. But when it’s positive, it suggests that an exchange has had more inflows than withdrawals.
Surprisingly, the net position change in Binance was much lower than Coinbase. Even though CEO Changpeng Zhao (CZ) confirmed an overall $329 million outflow lately, BTC’s net position change on the exchange peaked at -14,358 BTC on 10 June.