Crypto Exchanges Offer Paper Bitcoin Claims Market Analyst

-A market analyst has argued that bitcoins held on exchanges are nothing more than paper bitcoins that depresses the price of BTC.

-Rufas Kamau of Scope Markets Kenya made the statement in a Twitter thread on May 8.

-According to Kamau, a bitcoin that is bought and held on an exchange amounts to little more than an IOU or paper bitcoin.

-Exchanges manage the real bitcoin in much the same way as a bank manages customer money; by selling, lending, and leveraging that liquidity for profit.

-This leads to the proposition that when users buy bitcoin on an exchange, the liquid supply of bitcoins does not decrease as most people might expect.

-Ultimately, by fractionalizing bitcoin, as a bank would fractionalize money, the price of bitcoin is pushed down.

-For Kamau, this is yet another reason, beyond security and privacy concerns, why BTC investors should remove their bitcoin from exchanges: to push the price of the asset upwards.

BIC btc price floor drop.jpg.optimal Crypto Exchanges Offer Paper Bitcoin Claims Market Analyst
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