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News

Binance Suffers Rapid Loss After New SEC Allegations

June 6, 2023 - Around 2 mins mins to read

Key Points:

  • On Monday, Binance saw net outflows of almost $1.4 billion in one hour.
  • The withdrawals occurred as the SEC complaint charges that the world’s biggest cryptocurrency exchange by trading volume violated various federal securities laws.
  • Not just the exchange but the entire market seems to be affected by this news.
As the Securities and Exchange Commission (SEC) sued the company and its CEO, Changpeng “CZ” Zhao, for breaking federal securities law, cryptocurrency traders withdrew the most money from Binance since the financial crisis in March.
Binance Suffers Rapid Loss After New SEC Allegations

According to 0xScope, when the SEC sued Binance, its reserve assets had a net outflow of around $1.4 billion within 1 hour (14-15 UTC, June 5), accounting for 2.6% of its total reserve assets of $52.9 billion.

Blockchain data suggests that the exchange had $503 million in net withdrawals on Monday, according to a Dune Analytics report by crypto investment product provider 21Shares. The figure shows that traders have withdrawn more than $1 billion in digital assets over this time period, compared to $546 million in deposits.

The whole cryptocurrency market is down on the news, with most coins falling by 5%-10%. After the SEC’s lawsuit against the exchange and its CEO, altcoins have suffered the worst losses.

Although outflows are increasing, this is not necessarily unusual. In February, Binance had over 800 million net withdrawals in a 24-hour period when New York state officials clamped down on Binance-related stablecoin BUSD.

The SEC on Monday accused Binance, the world’s biggest cryptocurrency exchange, of mishandling client cash and lying to US authorities and investors about its operations in a broad lawsuit that has the potential to reshape the crypto landscape of power and riches.

Binance Suffers Rapid Loss After New SEC Allegations

According to the SEC, the world’s biggest cryptocurrency exchange covertly moved billions of dollars in client assets to a separate company owned by Binance’s founder, Changpeng Zhao.

In the 136-page complaint, the agency claimed that Binance had covertly transferred billions of dollars in consumer cash to a second business, Merit Peak Limited, which is owned by CZ.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your research before investing.

Join us to keep track of news: https://linktr.ee/coincu

Harold

Coincu News

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Author

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.
News

Binance Suffers Rapid Loss After New SEC Allegations

Key Points:

  • On Monday, Binance saw net outflows of almost $1.4 billion in one hour.
  • The withdrawals occurred as the SEC complaint charges that the world’s biggest cryptocurrency exchange by trading volume violated various federal securities laws.
  • Not just the exchange but the entire market seems to be affected by this news.
As the Securities and Exchange Commission (SEC) sued the company and its CEO, Changpeng “CZ” Zhao, for breaking federal securities law, cryptocurrency traders withdrew the most money from Binance since the financial crisis in March.
Binance Suffers Rapid Loss After New SEC Allegations

According to 0xScope, when the SEC sued Binance, its reserve assets had a net outflow of around $1.4 billion within 1 hour (14-15 UTC, June 5), accounting for 2.6% of its total reserve assets of $52.9 billion.

Blockchain data suggests that the exchange had $503 million in net withdrawals on Monday, according to a Dune Analytics report by crypto investment product provider 21Shares. The figure shows that traders have withdrawn more than $1 billion in digital assets over this time period, compared to $546 million in deposits.

The whole cryptocurrency market is down on the news, with most coins falling by 5%-10%. After the SEC’s lawsuit against the exchange and its CEO, altcoins have suffered the worst losses.

Although outflows are increasing, this is not necessarily unusual. In February, Binance had over 800 million net withdrawals in a 24-hour period when New York state officials clamped down on Binance-related stablecoin BUSD.

The SEC on Monday accused Binance, the world’s biggest cryptocurrency exchange, of mishandling client cash and lying to US authorities and investors about its operations in a broad lawsuit that has the potential to reshape the crypto landscape of power and riches.

Binance Suffers Rapid Loss After New SEC Allegations

According to the SEC, the world’s biggest cryptocurrency exchange covertly moved billions of dollars in client assets to a separate company owned by Binance’s founder, Changpeng Zhao.

In the 136-page complaint, the agency claimed that Binance had covertly transferred billions of dollars in consumer cash to a second business, Merit Peak Limited, which is owned by CZ.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your research before investing.

Join us to keep track of news: https://linktr.ee/coincu

Harold

Coincu News

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