Exchange News

US Inquiry Spurs Massive Binance `Stress Test` Outflow

  1. Binancians have been withdrawing significant sums of money from the platform.
  2. This has been hedged by the ongoing speculation by the US department of justice.
  3. The firm`s CEO has reassured users that the situation is improving.

The most recent revelation indicates that customers of Binance have been withdrawing significant sums of money from the platform. This encompasses the USDC/USD currency as well as other stablecoins. This has allegedly been hedged by the ongoing speculation by the US department of justice.

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According to the Nansen analytics company, Binance has already seen a net outflow of more than $3 billion worth of cryptocurrency assets over the course of the last week.

Zhao claims that this has happened previously, thus he proposes periodic “stress testing withdrawals” on all centralized exchanges (CEXs).

Notably, data from the analytics company Cryptoquant indicates that there was a pause in USDC withdrawals earlier on December 13th. The withdrawal stoppage was described by the exchange as being caused by a swap movement. This was a contest between USDC, which required open U.S. banks, and the Paxos-issued Binance USD stablecoin.

However, the CEO of Binance, Changpeng Zhao, has assured users that the situation is improving.

According to him, the withdrawals that were made were not the biggest that the company has ever handled, and they weren’t even in the top 5. He continues by saying that during the LUNA or FTX collapses, the industry processed more.

“I think some retail investors are freaking out because of the FUDs over Binance, but it seems to me the total amount is not that big,” Hochan Chung, head of marketing at crypto research firm CryptoQuant, said.

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Godfrey Mwirigi

Godfrey Mwirigi is an enthusiastic crypto writer with an interest in Bitcoin, blockchain, and technical analysis. With a focus on daily market analysis, his research helps traders and investors alike. His particular interest in digital wallets and blockchain aids his audience in their day-to-day endeavors.

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