Core Insights - Major exchanges Gate and Bybit report a significant shift in user holdings from volatile cryptocurrencies to stablecoins, indicating a deteriorating risk appetite among traders [1][2] - User holdings of Bitcoin and Ethereum on Bybit have decreased sharply, while USDT balances have surged nearly 28% as market volatility increases and expectations for a rate cut fade [1][2] User Holdings - Bybit's user BTC holdings fell to approximately 64,000 coins, a decrease of 3.13% or 2,068 BTC from September [2] - Ethereum holdings on Bybit declined by 5% to 542,200 ETH, losing 28,549 coins [2] - User USDT balances increased by 27.89% to approximately 6.389 billion, a rise of 1.393 billion [2] Market Conditions - The exodus from risk assets coincided with Bitcoin hovering near $108,000 and comments from Federal Reserve Chair Jerome Powell suggesting a slower path to policy relief [3] - Bitcoin slipped below $108,000, leading to a rebranding of October's narrative from "Uptober" to "Red October" as total crypto market capitalization fell by 3.1% to $3.69 trillion [7] Reserve Ratios - Both Bybit and Gate reported strong reserve ratios despite the shift in user holdings [4] - Bybit maintained a 103% reserve ratio for Bitcoin and 101% for Ethereum, while USDT reserves reached 110% [4] - Gate's total reserves were reported at $11.676 billion with an overall reserve ratio of 124%, and BTC reserves stood at 24,833 coins against user balances of 18,537 [5] - Gate's ETH reserves increased to 419,096 tokens, raising the excess ratio from 23.58% to 25.93% [5] - USDT reserves at Gate grew to approximately 1.58 billion, covering user holdings of around 1.33 billion with an 18.74% buffer [5] Asset Coverage - Gate's reserves now cover nearly 500 types of user assets, utilizing a Merkle Tree and zk-SNARKs algorithm for verification [6]

Asset Protection - Reserve ratio reaches 187% this month, indicating enhanced protection for user assets [1]