{"id":353848,"date":"2023-08-30T15:37:40","date_gmt":"2023-08-30T14:37:40","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=353848"},"modified":"2023-08-30T15:37:40","modified_gmt":"2023-08-30T14:37:40","slug":"a-closer-look-at-huobi-reserves-and-reliance-metrics","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/a-closer-look-at-huobi-reserves-and-reliance-metrics\/","title":{"rendered":"Huobi seeing increased outflows to competitors according to new reliance metrics"},"content":{"rendered":"<p class=\"p1\">The downfall of FTX has underscored the counter-party risks that exchanges can impose on the market. As traders and investors tread with heightened caution, there's an evident demand for reliable metrics to evaluate the health of these platforms.<\/p>\n<p class=\"p1\">Using the FTX data set as a benchmark, Glassnode has rolled out three innovative indicators designed to pinpoint high-risk scenarios among the major exchanges: <a href=\"https:\/\/cryptoslate.com\/companies\/coinbase\/\">Coinbase<\/a>, <a href=\"https:\/\/cryptoslate.com\/companies\/binance\/\">Binance<\/a>, <a href=\"https:\/\/cryptoslate.com\/companies\/huobi-global\/\">Huobi<\/a>, and the now-defunct <a href=\"https:\/\/cryptoslate.com\/companies\/ftx\/\">FTX<\/a>.<\/p>\n<p class=\"p1\">One of the indicators is the exchange reliance ratio, which shows when a significant portion of an exchange's balance is regularly transferred to or from another exchange. A significant portion of an exchange's balance being consistently moved to or from another platform might suggest a deep reliance or co-dependence on liquidity.<\/p>\n<p class=\"p1\">A positive ratio indicates net inflows to the exchange, while a negative one signifies net outflows. Prolonged periods of large negative values can be a red flag, indicating assets rapidly departing the exchange in favor of another platform.<\/p>\n<p class=\"p1\">While Binance and Coinbase exhibit a relatively low reliance ratio, indicating minor fund movements compared to their vast balances, Huobi's data paints a different picture. Recent figures showed pronounced negative reliance ratios across all Huobi assets, indicating a marked increase in transfers from Huobi to other exchanges.<\/p>\n<figure id=\"attachment_353917\" aria-describedby=\"caption-attachment-353917\" style=\"width: 1484px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-353917 size-full\" src=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi.jpg\" alt=\"huobi exchange reliance ratio\" width=\"1484\" height=\"741\" srcset=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi.jpg 1484w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi-300x150.jpg 300w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi-1024x511.jpg 1024w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi-768x383.jpg 768w\" sizes=\"(max-width: 1484px) 100vw, 1484px\" \/><figcaption id=\"caption-attachment-353917\" class=\"wp-caption-text\">Graph showing the exchange reliance ratio from Huobi from Aug. 30, 2021, to Aug. 30, 2023.\u00a0 (Source: Glassnode)<\/figcaption><\/figure>\n<p class=\"p1\">Huobi's internal reshuffling ratio, which shows the proportion of an exchange's balance transacted internally over a set period, mirrors that of Binance.<\/p>\n<figure id=\"attachment_353921\" aria-describedby=\"caption-attachment-353921\" style=\"width: 1486px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-353921 size-full\" src=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Binance-1.jpg\" alt=\"Binance's exchange reserve reshuffling ratio\" width=\"1486\" height=\"685\" srcset=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Binance-1.jpg 1486w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Binance-1-300x138.jpg 300w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Binance-1-1024x472.jpg 1024w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Binance-1-768x354.jpg 768w\" sizes=\"(max-width: 1486px) 100vw, 1486px\" \/><figcaption id=\"caption-attachment-353921\" class=\"wp-caption-text\">Graph showing Binance's exchange reserve reshuffling ratio from Aug.30, 2021, to Aug. 30, 2023 (Source: <a href=\"https:\/\/studio.glassnode.com\/workbench\/ac828cd9-fc2b-4854-787f-ad93685cd693?s=1630322267&u=1693394267&utm_campaign=woc_35_2023&utm_medium=insights_woc&utm_source=gn_insights&zoom=730\">Glassnode<\/a>)<\/figcaption><\/figure>\n<figure id=\"attachment_353923\" aria-describedby=\"caption-attachment-353923\" style=\"width: 1463px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-353923 size-full\" src=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Huobi.jpg\" alt=\"Huobi's exchange reserve reshuffling ratio\" width=\"1463\" height=\"716\" srcset=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Huobi.jpg 1463w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Huobi-300x147.jpg 300w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Huobi-1024x501.jpg 1024w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/Exchange-Risk-Reserve-Reshuffling-Ratio-7D-MA-Huobi-768x376.jpg 768w\" sizes=\"(max-width: 1463px) 100vw, 1463px\" \/><figcaption id=\"caption-attachment-353923\" class=\"wp-caption-text\">Graph showing Huobi's exchange reserve reshuffling ratio from Aug.30, 2021, to Aug. 30, 2023 (Source: <a href=\"https:\/\/studio.glassnode.com\/workbench\/1be026c4-3335-46b0-7562-96a147f82904?s=1630322376&u=1693394376&utm_campaign=woc_35_2023&utm_medium=insights_woc&utm_source=gn_insights&zoom=730\">Glassnode<\/a>)<\/figcaption><\/figure>\n<p class=\"p1\">However, context is crucial here. Binance, the largest and most popular exchange on the market, dwarfs Huobi in every metric. Thus, the reshuffling spikes observed with Huobi could be magnified due to its depleting reserves.<\/p>\n<figure id=\"attachment_353877\" aria-describedby=\"caption-attachment-353877\" style=\"width: 1800px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-353877\" src=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi-proof-of-reserves-3y.png\" alt=\"huobi proof of reserves 3y\" width=\"1800\" height=\"1013\" srcset=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi-proof-of-reserves-3y.png 1800w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi-proof-of-reserves-3y-300x169.png 300w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi-proof-of-reserves-3y-1024x576.png 1024w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi-proof-of-reserves-3y-768x432.png 768w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2023\/08\/huobi-proof-of-reserves-3y-1536x864.png 1536w\" sizes=\"(max-width: 1800px) 100vw, 1800px\" \/><figcaption id=\"caption-attachment-353877\" class=\"wp-caption-text\">Graph showing the total balance (in USD) of Huobi's holdings from Aug. 2020 to Aug. 2023 (Source: <a href=\"https:\/\/studio.glassnode.com\/metrics?a=BTC&e=huobi&m=distribution.ProofOfReservesAll&resolution=24h&s=1598786566&u=1693394566&zoom=1095\">Glassnode<\/a>)<\/figcaption><\/figure>\n<p class=\"p1\">This connection between diminishing reserves and pronounced negative reliance ratios could be concerning. It suggests that assets are being moved internally with greater frequency and being transferred <a href=\"https:\/\/cryptoslate.com\/huobi-insolvency-rumors-as-usdt-reserves-decline-on-all-exchanges-except-binance\/\">out of Huobi<\/a> at a growing rate.<\/p>\n<p class=\"p1\">The correlation between Huobi's dwindling reserves and its significant negative reliance ratios might indicate eroding confidence in the platform. While these metrics don't definitively label an exchange as high-risk, the coming months will show if these indicators are passing anomalies or precursors to a more profound shift.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The downfall of FTX has underscored the counter-party risks that exchanges can impose on the market. As traders and investors tread with heightened caution, there&#8217;s an evident demand for reliable metrics to evaluate the health of these platforms. Using the FTX data set as a benchmark, Glassnode has rolled out three innovative indicators designed to [&hellip;]<\/p>\n","protected":false},"author":759,"featured_media":353863,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[120,39,77921,6849],"tags":[76714,78819,75416,76833,77338,77001,78818],"post_folder":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v21.9 (Yoast SEO v21.9.1) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Huobi seeing increased outflows to competitors according to new reliance metrics | CryptoSlate<\/title>\n<meta name=\"description\" content=\"Huobi&#039;s dwindling reserves and significant negative reliance ratios might indicate eroding confidence in the platform.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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