Binance’s ongoing ‘stress test’ sees $3B outflows in 7 days: Here’s everything that’s happened so far – USD Coin (USDC/USD)

Users withdrawing huge amounts of money binanceIncluding us dollar coin USDC/USD and other stable coins. Binance has seen a net outflow of over $3 billion in crypto assets over the past seven days, according to Nansen,

how it started: It all started on Monday when Binance experienced an unprecedented wave of exits due to concerns over the Proof of Reserves report. According to the Blockchain Intelligence Platform NanaseNet outflows – the difference between the total value of assets coming in and going out of the exchange – were an eye-watering $902 million in just one day. This marked a dramatic jump in investor sentiment away from the exchange, raising serious questions about its holdings.

Despite the fact that Binance provides its public wallet addresses for added transparency, many investors are still unsure about the degree of transparency of the exchange. Notably, no details were provided regarding potential liabilities of Binance in wallet balances.

See more: Best Crypto Day Trading Strategies

In an effort to clear some doubts, Binance requested a “Proof of Reserves” report from an accounting firm. Mazar To demonstrate the financial strength of the company. The report revealed that Binance had funds to cover more than 100% of its depositors.

But, the effort still left critics unsatisfied. Investors should not be satisfied with the report, Douglas Carmichael, a Baruch College accounting professor in New York and former chief auditor of the US Public Company Accounting Oversight Board, acknowledged. “I can’t imagine that this answers all of an investor’s questions about the adequacy of collateralization,” carmichael Told Wall Street Journal.

tombs cleaned itr that their report does not guarantee the continued validity of Binance’s reserve funds and was a “snapshot” of Binance’s reserves at the time of the audit on November 22.

On Monday, Reuters reported that US prosecutors are analyzing the facts of the criminal Possible money laundering case against Binance, changpeng zhaoBinance CEO tells users on Twitter to “ignore the FUD” – crypto lingo for spreading rumours.

continued discomfort: A deep sense of worry and concern for the health of Binance pervaded the market on Tuesday. This apprehension was exacerbated by reports of Tron justin sun $50 million withdrawn from Binance. The anxiety in the market was palpable and the news of the withdrawal added to the unease.

Binance tweeted that it was Temporarily suspending USDC withdrawals as it engages in a token swap between USDC and BUSD bus/usd (which is administered by Paxos). Zhao acknowledged the increase in USD Coin withdrawals from Binance and explained that swapping from Pax/Bus to USDC requires going through a banking service in New York in USD. He further said that banks are still open hours after his statement, at which point normalcy would be expected to be restored.

the allies, Suraj tries to calm the market Turns concerns back by tweeting a link to Etherscan depositing $100 million in USDC into the exchange.

lanyard USDT/USD Announces its cooperation with Binance An on chain swap involving the exchange of 3 billion USDT from the Tron network to the Ethereum network. The total supply of Tether is not expected to be affected in the process. “Within minutes, Tether will coordinate with Binance to perform an on-chain swap, converting tron TRX/USD To Ethereum ETH/USD ERC20, 3B for USDT. The total supply of Tether will not change during this process,” Tether said.

Binance has resumed taking withdrawal requests for the USD Coin stablecoin after being halted for several hours.

stress testAccording to Zhao, the exchange has seen this before, and he believes it is “a good idea to do ‘stress test withdrawals’ on every CEX. [centralized exchange] on rotation basis”.

Lia Halpern, A Bitcoin BTC/USD Enthusiastic, noted that “if Binance goes down, everything else will crumble.” He further explained that while bitcoin can survive, the entire crypto landscape, such as stablecoins, will not.

Read further: Bitcoin, Ethereum, Dogecoin Surge Forward in Defying Binance Outflow Problems – Analyst Says What It Will Take for BTC Rally to Continue

Source link

Leave a Comment