A bunch of scandals sapped up liquidity in crypto markets last year. But even as prices have recovered in 2023, the so-called “Alameda Gap” has persisted, with liquidity still nowhere near levels notched before FTX collapsed.
Bitcoin market depth is “well below” levels seen in November, the month the now infamous exchange run by Sam Bankman-Fried went under. The quantity of Bitcoin and USDT bids and asks within 2% of the mid-price, as seen across 16 exchanges, hovered around 8,000 this month, about 40% less than in October, according to researcher Kaiko.
