Giant cryptocurrency exchange Binance has recorded massive withdrawals in the past week. On Tuesday, December 13, suffered the highest amount of one-day withdrawals since June, according to data by Nansen.
Binance’s international arm witnessed more than $8.78 billion leave its exchange against incoming funds totaling $5.1 billion. The behemoth exchange was left with a $3.66 billion deficit with this outflow-inflow rate.
“Binance Netflow 7D ($) -3,660,311,347 8,783,380,428 – Outflow 5,123,069,081 – Inflow Exchange Flows dashboard http://nsn.ai/exchgf”
Binance Record Highest Outflow Since November 13
Based on data provided by blockchain data platform Arkham Intelligence, the outflow was the highest for Binance since November 13, two days after cryptocurrency exchange FTX filed for bankruptcy. In a Telegram chat, an Arkham analyst explained that the outflow does not seem unusual because there is an apparent $64 billion worth of assets on Binance.
Although such data only attributes to the movements of Binance’s Ethereum and ERC-20 token, almost 63% of the exchange’s portfolio is on Ethereum. Additionally, the outflows are far more than other exchanges within the same time frame.
The behemoth exchange’s $3.66 billion weekly outflow is by far higher than what its industry peer, Coinbase, recorded with a net flow of approximately $574 million from its central exchange and $248 million from its subsidiary, Coinbase Custody service.
On the other hand, Binance subsidiary Binance US saw a net outflow of more than $38.7 million within the same period.
Among those withdrawing funds from Binance was renowned Web3 firm Jump Crypto. According to Nansen data, JumpCrypto withdrew almost $18.4 million on Ethereum this week and approximately $123.4 million from Binance the last week.
Although Binance is currently experiencing a high volume of withdrawals, the exchange still holds almost $58.9 billion in assets as of this writing, most of which are in Binance’s stablecoin BUSDm, the stablecoin Tether, Bitcoin, and Ethereum. Citing Nansen on Twitter:
“Using their publicly provided addresses, we display Binance’s holdings under our Exchange Holdings tab: Total value: ~$62.6 Billion Majority tokens: – $BUSD – $USDT – $BTC – $ETH Find it here for free: http://portfolio.nansen.ai/dashboard/binance“.
Based on Nansen’s portfolio tracker, the total portfolio of Binance exchange plummeted by $3.5 billion barely eight hours into December 13.
The giant exchange’s token, BNB, now ranks #5 in the list of cryptos by market capitalization but is down almost 3% in the last 24 hours, and down 12.3% in the past two weeks, against Bitcoin’s 1.2% price downtick, according to data on CoinMarketCap.
Binance CEO Responds to Mass Withdrawals
Binance CEO Changpeng Zhao, alias CZ, responded to the Nansen report on mass outflows, saying it was a typical day in the crypto market. The Twitter post reads:
“We saw some withdrawals today (net $1.14b ish). We have seen this before. Some days we have net withdrawals; some days, we have net deposits. Business as usual for us.”
CZ also tweeted a follow-up, reassuring his 8M followers, “Things seem to have stabilized. Yesterday was not the highest withdrawal we processed, not even the top five. We processed more during LUNA or FTX crashes. Now deposits are coming back in.”
Further, he described the situation as a “stress test withdrawal,” saying such moves are an excellent idea to keep centralized exchanges in check.
The Binance CEO also disclosed that USDC withdrawals on Binance US had been temporarily paused due to a token swap issue where the exchange could not convert funds due to a New York bank—the liquidity provider for the swap—being closed.
The withdrawals have since resumed.
Despite the voluminous withdrawals, Binance maintains its position as the leading exchange, holding assets worth more than $58 billion, which signals a sturdy financial base for the business.
Binance Officials Face Criminal Charges
Still, on Binance, a Reuters report says that U.S. prosecutors are contemplating criminal charges against Binance and its executives, including CEO Changpeng Zhao. From the information, CZ and his team of Binance executives are being investigated on charges of money laundering.
However, Changpeng Zhao has told his 8 million followers on Twitter to “ignore the FUD,” a slang in the crypto sphere used about ‘fear, uncertainty, and doubt.’
