Is Binance in troubles?

Stay Tuned with MEXC Global (12/14/2022)

The cryptocurrency market is going through a lot of "turbulence," especially after the arrest of Sam Bankman-Fried, the developer of FTX, on Monday. One of the most well-known centralized cryptocurrency exchanges in the world, Binance, saw withdrawals of $3 billion on Tuesday, according to Nansen, a blockchain analytics firm. Additionally, Binance temporarily stopped its USDC withdrawals on Tuesday.

Binance Withdrawals: $3 Billion in 24 Hours (Image source: Coinfomania)

According to CNN Business, Binance had a $3 billion net outflow in just one day. The US Justice Department is investigating Binance for any potential criminal conduct and money laundering. These negative reports have a negative effect on the users' trust in Binance. People worry about their financial situation and the consequences of the ongoing FTX contagion.

“Concurrently, a large market maker, Jump, was found to have withdrawn huge sums from Binance with no deposits over the past few weeks — ultimately seems to have caused jitters among both retail and institutional users,” “In short, it’s a lot of money headed out, and that’s spooked some folks.”

Said Andrew Thurman, the content lead at Nansen, in a CNN report.

The CEO of Binance, Changping Zhao (CZ), responded to the rumors by saying that "some withdrawals" are perfectly common in the cryptocurrency industry. "If there's any risk that we fail, it all depends on how we fail," CZ stated during a Twitter AMA session.

“As long as we fail honorably and credibly, we let people withdraw their funds because the company ran out of money, that’s okay,”

Final Reflections
Investors in cryptocurrencies have been worried since since the FTX crash and the arrest of the former CEO SBF. The cost of bitcoin quickly dropped to about $17,800 despite reaching a peak today of about $18,300. During this crypto winter, we may have the opportunity to stock up on bitcoin at a bargain. Don't forget to perform your own research before trading!