Binance added another 1,315 Bitcoin (BTC) on Tuesday, Feb. 4, to its Secure Asset Fund for Users (SAFU) valued at $100.42 million. This strengthens user protection as volatility continues.
This is a part of Binance’s plans to convert its stablecoin reserve of up to $1 billion into Bitcoin over 30 days. It is the second large Bitcoin purchase by Binance this week. Based on Arkham data, total SAFU holdings now consist of 2,630 Bitcoins (BTC) and are currently valued at approximately $201.12 million.
Source: Arkham
Binance announced the conversion in a post to Twitter, stating, “We’re continuing to acquire Bitcoin for the SAFU fund, and we are committed to completing the conversion of the fund within 30 days of our original announcement.”
Bitcoin Price Continues to Drop
As of now, the price of Bitcoin continues to trend downwards due to weak markets, having fallen 3.57% to $76,052 in the last 24 hours, according to CoinMarketCap data.
Shortly before it started to recover, BTC momentarily traded around the $73,000 mark due to the wider sell-off on the markets. The volatility and macro uncertainty have attracted higher trading activity from market participants. Consequently, its 24-hour trading volume improved by 17.8% to $67.1 billion.
Source: CoinMarketCap
Also Read | Bitcoin Falls to $76,000 as Ongoing Sell-Off Delays Trend Reversal
Derivative Markets Signify Fear
As CoinGlass indicated, the total trading volume of all futures has increased by 48.9%, to $109.8 billion. However, the total open interest of all futures declined 1.59%, to $50.8 billion. This indicates that traders have closed out their leverage positions rather than establishing new long or short positions.
Binance’s BTC/USDT long/short ratio was at 0.96, indicating that there were slightly more bearish positions than bullish positions on active accounts.
Source: Coinglass
ETF Investors Are “Underwater”
Additionally, popular market analyst Ali Charts stated that BTC’s price has now fallen below the average ETF cost basis of $82,600 for the first time in over 18 months.
This represents the approximate average price at which U.S. spot BTC ETFs acquired the Bitcoins that they have accumulated since their launch. When BTC falls below the investors’ average cost, it typically causes greater market volatility.
Why This Matters
Binance is backing its user safety fund with more BTC, signaling strong long-term confidence in the coin even as ETF investors sit at a loss.
Also Read | Bitcoin Slips Under $75K As Whale Sell-Off Tops 50K BTC in Two Weeks
Risk Disclosure: This article is for informational purposes only and does not constitute financial advice.
