Users withdraw over $392 million from Binance within 24 hours

In a recent series of tweets, Changpeng Zhao (CZ), the CEO of Binance, revealed that the cryptocurrency exchange experienced a substantial net withdrawal amounting to approximately $392 million within a span of 24 hours.

This revelation sheds light on the cash movement within the exchange during a turbulent period following the U.S. Securities and Exchange Commission’s legal action against Binance and Coinbase, which created substantial ripples across the cryptocurrency industry earlier this week.

Such developments within the cryptocurrency industry often attract attention and speculation, as market participants closely monitor the movements and activities of major exchanges.

However, the Binance CEO was swift to differentiate between cash withdrawals and changes in assets under management (AUM), emphasizing that the former might present a misleading impression of the company’s financial condition to external observers. 

Arbitrage traders often transfer large sums of money between exchanges on days marked by significant price fluctuations, resulting in remarkably substantial outflows.

These withdrawals probably stem from investors seeking to capitalize on price disparities across various platforms rather than indicating a lack of trust in the exchange as a whole.

This is not the first time such massive outflows have been experienced on Binance. The CEO mentioned that in November 2022, users withdrew $7 billion on a single day yet the exchange didn’t fail on their obligations. 

These statements follow a Glassnode article published on June 6, which revealed that after the SEC filed 13 civil charges against Binance, the exchange experienced a net outflow of 10,500 Bitcoin (BTC). 

Binance’s current situation

Despite this increase, the current value remains significantly lower than the record-high net outflow of 40,300 BTC.

Furthermore, withdrawals ranging from $1 million to $10 million constituted 51% of this outflow, indicating that more significant transactions predominantly influenced the overall movement of funds.

Although recent withdrawals occurred, Binance still holds a substantial amount of bitcoin in its exchange addresses. 

According to Glassnode, the current balance is 694,000 BTC, just 10,500 BTC shy of the all-time high of 704,500 BTC.

Despite recent developments, Binance retains a considerable quantity of bitcoin. The increased market activity in response to regulatory news is evident from Nansen, a data company, reporting a massive outflow of $780 million from Binance on June 6.