$3.6 billion withdrawn from Binance – Is the platform in danger?
Leaking users? The Binance exchange was hacked in one week and the total amount exceeded 3.6 billion dollars. But Changpeng Zhao (CZ) is reassuring, saying it’s just a “stress test” for the exchange. Should we believe it?
$3.6 billion was withdrawn from Binance during the week
Analyst firm Nansen reported that Binance withdrawals were particularly high this week. In general, the platform More than 3.6 billion dollars left its treasury :
Binance Netflow 7D ($) -3,660,311,347
8 783 380 428 – outflow
5 123 069 081 – inputExchange Flows dashboard ⤵️https://t.co/CYrBQLryQ0 pic.twitter.com/vV6vcqoWKK
— Nansen ? (@nansen_ai) December 13, 2022
In comparison, Coinbase has “only” lived During the same period, 574 million dollars were withdrawn. The difference is, of course, explained by the difference in size of the two institutions, but not only.
Significant market makers According to another Nansen analyst, it actually ran off the platform:
As Binance FUD rises, some pretty notable streams in different time frames
Jump on its own, pulling in over $135 million for the week, Wintermute pulled in nearly $10 million in the last hour, and netted $300 million in the last day
Watch here: https://t.co/aasol67vsX pic.twitter.com/FeN7Myt3CN
-Andrew T (@Blockanalia) December 12, 2022
Wintermute and Jump Finance actually contributed $300 million in transit over the course of December 12. There’s a reason for that: Binance really came into the spotlight earlier this week, and not in a good way.
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Users are panicking on Binance
A few events really panicked investors. On the one hand, we learned on December 12 Binance will be targeted by American justice, he said, as part of a money laundering investigation. A Reuters investigation claimed that the platform would have handled more than $10 billion in transactions on behalf of criminal or illegal individuals had the controls not been taken.
Binance, of course, denied the facts and praised the monitoring team. But this was enough to panic users who started transferring money. So much so that the platform was rocked on December 12: USDC withdrawals were temporarily suspended. A case that Changpeng Zhao justified by the closure of banks on weekends, but which failed to convince especially cautious investors since the fall of the FTX.
Changpeng Zhao spoke again in recent days to calm concerns. So he claimed said it was a “stress test” for the platform, which proves its strength. It should be noted that Binance has significant reserves, which increased it after the fall of FTX. CZ also mentioned that all Binance funds are counted and listed and user funds are not used:
Some network fees are required to run these “tests”. But it keeps the industry healthy.
The exchange is simple. ?
2/2https://t.co/LwnHERsfJB
— CZ ? Binance (@cz_binance) December 13, 2022
“If the exchange keeps its users’ assets intact, it’s not the tweets that will cause the problem. It’s simple.»
That obviously wasn’t enough to convince the community. This is the problem of the hegemony of an institution: if it is threatened, the consequences of a possible decline are particularly strong, and this is felt in the fear of users.
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Source: Binance, press release
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A journalist at Cryptoast, I fell into the cauldron of cryptocurrencies a few years ago. I’m passionate about innovative technologies stemming from blockchain and I love finding the crunchiest information to share with you.
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