Binance, the world’s largest crypto exchange by trading volume, is enduring a wave of withdrawals on Monday. Net outflows, the difference between the value of assets arriving and leaving the exchange, reached $902 million in the last 24 hours, according to data by blockchain intelligence platform Nansen.
Binance’s outflow is even higher than those of all other centralized exchanges in the last 24 hours and 9 times higher than Bitfinex – the second largest outflow. The outflơ has hit its highest level since Nov 13, two days after FTX filed for bankruptcy protection, according to Arkham Intelligence.
However, the outflow doesn’t seem notably anomalous, said Arkham analyst Henry Fisher on Telegram, comparing the outflow to $64 billion of assets on Binance.
Jump Trading and Wintermute were among those moving the largest amount of money from Binance in the past 7 days. Specifically, Jump has net outflows from Binance in excess of $146 million, including $102 million of BUSD, $14 million of USDT, $10 million of ETH, and $30 million of BUSD from Paxos a few hours ago. Meanwhile, Wintermute withdrew $8.5 million of wBTC and $5.5 million of USDC.
The wave of massive withdrawals followed a series of concerning news reports about Binance. Binance has been suspected of violating sanctions and anti-money laundering laws since 2018. According to Reuters, some prosecutors have filed criminal charges against 12 Binance executives, including Binance CEO Changpeng Zhao.
This year, Reuters also conducted many independent investigations into Binance, claiming that it kept weak anti-money laundering controls. The company enabled the laundering of some $2.5 billion between 2017 and 2022 and disclosed information to the Russian authorities. In July, Binance helped Iranian firms trade $8 billion despite US sanctions.
In response, Binance has disputed the articles, claiming the exchange is still improving its technology to enhance its anti-money laundering operations. Last week, Binance was condemned by the community for suspending a user’s account for being unreasonable. And even though it published Proof-of-Reserves (PoR) audits and the report claims assets are backed 101% by collateralized reserves, Binance still has not met the media’s demand. The Wall Street Journal pointed out that Binance’s PoR report isn’t quite transparent enough.
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