Cryptocurrency bear markets led many companies to halt their activities in this sector. The drying up of liquidity and the emptying of order books fueled negativity during those times. However, the tide is now turning.
Citadel and Cryptocurrencies
Centralized cryptocurrency exchanges faced significant liquidity issues amid the intensified bear markets of 2022. As liquidity providers and market makers withdrew from the crypto space due to escalating risks, this trend accelerated by the end of 2023. The emptying of order books prompted the emergence of new market makers like DWF.
Recovery Signs for Citadel
Prominent liquidity providers such as Citadel had withdrawn due to increased regulatory risks following the FTX collapse. Now, the opposite scenario is unfolding. With Trump’s ascent to power promising regulatory clarity for cryptocurrencies, Citadel is set to re-enter the crypto arena.
According to Bloomberg, Ken Griffin’s market-making giant Citadel Securities resuming investments as a market maker could provide substantial support for a general market rally. The withdrawal of globally operating market makers had notably resulted in above-average declines, particularly in altcoins, due to the empty order books.
