Binance is experiencing an impressive flight of capital: members of the platform have withdrawn the equivalent of 900 million dollars in 24 hours. A few weeks after the bankruptcy of FTX, the market is still feverish.
Update from December 13 at 6 p.m.: ” Withdrawals are back online », let it be known Binance at the end of the day. For several hours, it was no longer possible to make withdrawals in USDC, a stablecoin. Changpeng Zhao, the leader of Binance, had indicated that we had to wait for the reopening of the banks for the situation to be restored.
Original post: It is no longer a wave of withdrawal, it is almost a tsunami. Within 24 hours, Binance’s net outflow of capital almost reached $1 billion. A total of $902 million was withdrawn from the platform, reports CoinDesk. The news outlet reports that outflows from Binance have surpassed all others in the cryptocurrency industry in the past 24 hours — moreover, the sum is nearly 9 times larger than other comparable outflows.
Nothing very good for Binance, then. It must be said that the largest crypto-currency exchange platform in the world is having a rough start to the week. Implicated by the United States in a money laundering case and accused of not having been completely transparent in certain reports, Binance is undergoing major upheavals, in a market still shaken by the bankruptcy of FTX.
Suspicions of money laundering in the US
Withdrawals on Binance surged after reports “ worrying about the company’s financial health, according to CoinDesk. After rival platform FTX went bankrupt, Binance pledged to release evidence of its funds, “ over-collateralized according to the company. This concept refers to the provision of a guarantee whose value is more than sufficient to cover potential losses in the event of default.
The audit, carried out by Mazars, was published on December 7 and rather proves Binance right – but some doubts remain.
An expertquoted by CoinDesk, thus criticizes the lack of transparency on the management of funds, the Mazars report only confirming the presence of collateral, and the Wall Street Journal believes that “ his finances remain a mystery “.
To these doubts must be added the publication of an article by Reuters on December 12, in which the agency announced that the American courts would consider taking Binance to court. A money laundering investigation is underway in the United States against the platform, and according to Reuters sources, some US prosecutors are ready to press charges against Binance executives, including its founder and chairman Changpeng Zhao.
It was enough for individuals and investors to withdraw and leave with their crypto possessions. It is this leak that was observed by CoinDesk, and which is currently equivalent to nearly a billion dollars.
A traumatic year for crypto
2022 will go down as a year marked by a violent “bear market” and the impressive bankruptcies of companies deemed to be very reliable. We remember in particular the fall of the Terra / Luna ecosystem, which led to the destruction of more than 50 billion dollars, that of the very famous investment fund 3 Arrows Capital, or the collapse of the platform of Celsius loan, which declared bankruptcy.
To all these events is added the FTX trauma. The one that was the second largest crypto exchange platform in the world, behind Binance, sank in just a few days in full bankruptcy and without money.
After all these episodes, crypto investors and individuals are therefore more than feverish at the idea of another bankruptcy. For now, Binance assures that no problems exist with withdrawals and that there is no liquidity concern. The company reportedly has more than $60 billion in funds. But, as the difficulties mount, if the withdrawals continue, this capital flight could become a real problem for Binance.