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EUnited States Securities and Exchange Commission (SEC) announced on June 5 that it sued Binance, the world’s largest crypto exchange, for alleged securities fraud. The announcement sent shockwaves in the market as the price of BNB and others suffered, and users struggled to remove their crypto from the exchange.
$1.5 billion withdrawn in 24 hours
In the 24 hours following the SEC announcement, Binance saw an expected jump in withdrawal volumes. According to data from defilama, Binance’s net inflows rose sharply but with outflows remaining high, it offset all inflows as withdrawals dominated its volume. In total, $1.5 billion worth of crypto assets left the exchange in the 24-hour period following the SEC’s announcement.
On-chain data aggregation firm Nansen also informed of on Binance outflow. The dashboard showed that only transfers on the Ethereum blockchain on the exchange reached a negative net inflow of $778 million on the global platform, while the US branch saw a negative net inflow of $12,982,964.
Outflows reach $1.5 billion | Source: DeFiLlama
Trading volumes on the exchange also remained high during this period with $6.24 billion in spot volume during the one-day period. Open interest on the trading platform also climbed to $8.8 billion with an average leverage of 0.17x.
Despite the outflow, Binance remains ahead of the rest of the market with almost $50 billion in assets in reserve. This means that the outflow of $1.5 billion only accounts for less than 3% of the exchange’s total reserves.
Can Binance Recover From Here?
This is not Binance’s first rodeo when it comes to an event that triggered massive outflows from the exchange. In fact, the current outflow remains in the range of ‘normal’ for the exchange, which saw over $2 billion in single-day outflows in December 2022.
Given that the exchange was able to come out of the FTX incident even though investor confidence had plummeted, the chances of coming out of this unscathed also remain high, as outflows are small. CEO Changpeng Zhao has also adopted a new mantra this year to ‘Ignore FUD’ as he has in the past assured users that their funds were safe.
recently do It appears that Zhao is addressing the SEC following the exchange. The SEC which has now sued multiple firms has come after the crypto industry in general and not just one firm. The CEO said, “If you have to quarrel with everyone, you are probably at fault.”
At the time of writing, Binance’s native token BNB is yet to recover from Monday’s crash. The coin is trading at $277.58, down 7.81% in the last 24-hours with a loss of 11.30% on the weekly chart.
BNB price drops over 10% in 24 hours | Source: BNBUSD on TradingView.com
