E US Securities and Exchange Commission (SEC) announce On June 5, the world’s largest cryptocurrency exchange, Binance, sued for alleged securities fraud. The announcement sent the market crashing as the price of BNB and others suffered, and users demanded that their cryptocurrency be removed from the exchange.
1.5 billion dollars withdrawals in 24 hours
In the 24 hours since the SEC’s announcement, the volume of withdrawals from Binance has seen an increase as expected. according to Data from DeFiLlamaBinance net inflows rose rapidly but as outflows continued to rise, it more than offset all inflows as withdrawals dominated their volume. In total, the exchange saw $1.5 billion in crypto assets leave the exchange in the 24-hour period following the SEC’s announcement.
On-chain data aggregation company Nansen as well mentioned on Binance Streams. The dashboard showed that transfers on the exchange’s Ethereum blockchain alone reached a net negative inflow of $778 million on the global platform, while the US arm saw a net negative inflow of $12,982,964.
Outflows reach $1.5 billion | Source: DeFiLlama
Trading volume on the stock exchange also remained high during this time with spot trading volume reaching $6.24 billion in a single day period. The open interest rate on the trading platform also rose to $8.8 billion with an average leverage of 0.17 times.
Despite the outflows, Binance is still ahead of the rest of the market with about $50 billion in assets in its reserves. This means that the outflows of $1.5 billion are only less than 3% of the stock exchange’s total reserves.
Can Binance recover from here?
This isn’t Binance’s first rodeo when it comes to an event that has caused massive inflows from the exchange. In fact, the current outflows are still in the ‘normal’ range for the exchange which saw more than $2 billion in one-day outflows in December 2022.
Given that the exchange was able to exit the FTX event unscathed even after investor confidence was greatly eroded, the probability of it exiting the event unscathed is still high given the low outflows. CEO Changpeng Zhao also adopted a new slogan of “Ignore FUD” this year as he assured users in the past that their funds were safe.
newly tweet Zhao appears to address the SEC after the exchange. It appears that the SEC, which has sued several companies, will go after the cryptocurrency industry in general and not just one company. “If you have to pick a fight with everyone, you’re probably the one,” said the CEO.
At the time of writing, Binance’s native BNB token has yet to recover from Monday’s crash. The coin is trading at $277.58, down 7.81% in the last 24 hours with losses of 11.30% on the weekly chart.
BNB price drops over 10% in 24 hours | Source: BNBUSD on TradingView.com