Some say it is a well-deserved recompense for triggering the downfall of FTX. Others contend that this is simply a manifestation of the contagion that has been slowly but irrevocably spreading through every possible crevice in the crypto sphere. Regardless of the raison d’être behind the latest bout of upheaval, it is an undeniable fact that Binance appears to be in a maelstrom.
-39,637 BTC pic.twitter.com/nraXyco6Ai — Dylan LeClair 🟠 (@DylanLeClair_) December 13, 2022 Over the past 24 hours, nearly 40,000 Bitcoins have been removed from Binance.
-$2.159B Total remaining balance: $20.483b pic.twitter.com/DuhCruEztF — Dylan LeClair 🟠 (@DylanLeClair_) December 13, 2022 Moreover, the exchange just recorded its largest-ever outflow of stablecoins in a 24-hour window, clocking in at over $2 billion. This sudden exodus of funds is now having a sizable impact on Binance’s Total Value Locked (TVL) metric, which stood at over $67 billion on the 11th of November but has now decreased to just around $60 billion, corresponding to a decline of around $7 billion – most of which took place over the past 48 hours.
Now it’s marking a 5.9% decline in the past 24h, being the biggest loser in the top 10: https://t.co/UTXkCjAAZC A 🧵 on money flow. pic.twitter.com/1xeiA1Y1xm — COIN360 (@COIN360com) December 13, 2022 So, what went wrong? Firstly, Binance had tasked Mazars to perform an “audit” of its Bitcoin reserves. However, as per the auditor’s press statement last week, the examination was quite narrow in its breadth, focusing only on “in-scope” assets and utilizing “agreed-upon procedures.” In what proved to be a critical point of contention, the auditor noted: Significantly, Binance’s proof-of-reserves attestation glossed over the exchange’s liabilities, with CZ laying down the proverbial gauntlet in the following words: Additionally, as we reported yesterday, Reuters sent another wave of jitters this week when it reported that the US Department of Justice (DoJ) is currently split on whether to formally level charges against Binance in a money laundering investigation that began in 2018, with some investigators now pushing for aggressively moving against key Binance executives, including its co-founder and CEO, Changpeng Zhao (CZ). Moreover, the firm’s lawyers have met with DoJ officials over the past few months to discuss a possible plea deal or an out-of-court settlement.
Now they’re attacking our incredible law enforcement team. A team that we’re incredibly proud of - they’ve made crypto more secure for all of us. Here’s the full statement we sent the reporter and a blog about our remarkable law enforcement team. — Binance (@binance) December 12, 2022 Binance countered the report by denying any “insight” into the inner workings of the Department of Justice while highlighting the exchange’s contribution to upholding the law.
Then he transferred 33,911,530 $BUSD to Paxos Treasury. And exchanged 15,432,715 $USDT for 15,435,455 $USDC and transferred to #Circle. pic.twitter.com/SCSPcjYVTC — Lookonchain (@lookonchain) December 13, 2022 Thereafter, Tron founder Justin Sun prompted another wave of anxiety when he withdrew over 33 million Binance USD (BUSD) and over 15 million Tether (USDT) from the exchange.
— Wu Blockchain (@WuBlockchain) December 13, 2022 The halting of USD Coin (USDC) withdrawals on Binance further compounded the atmosphere of fear among investors.
— CZ 🔶 Binance (@cz_binance) December 13, 2022 Of course, as investors panicked, Sun quickly deposited $100 million back into Binance, with Changpeng Zhao later clarifying that Sun’s withdrawal was “part of deploying BUSD on TRON.” Throughout this saga, Changpeng Zhao has continued to project confidence in Binance’s financial viability by tweeting: Despite CZ’s protestations, the BNB coin remains under pressure as the entire crypto world continues to hold its collective breath on the question of Binance’s solvency. Do you think CZ is now facing karma for his hubris in the FTX saga? Let us know your thoughts in the comments section below.
