Almost $4 billion in customer fund outflows have left Binance and Coinbase in the last week. Customers have been withdrawing funds en masse from the world’s top crypto exchanges after last week’s high-profile lawsuits against Binance and Coinbase by the U.S. Securities and Exchange Commission (SEC).
So far, blockchain analytics data from Nansen and Glassnode indicate that almost $4 billion in fund outflows from customers have left Binance and Coinbase in the last week, with $3.1 billion leaving the Ethereum network alone, and an additional $864 million leaving the Bitcoin network.
On Friday, Binance CEO Changpeng “CZ” Zhao sought to reassure customers by claiming that declining crypto prices were one reason for this “outflow.” He also reiterated that customer fund outflows are normal, claiming digital assets are inherently volatile assets.
“Some even only measure outflow, not inflows,” he said on social media about the blockchain analytics firms. “On a sharp price movement day like today [Friday], many arbitrage traders move a lot of funds between exchanges, usually exponentially more than on normal days.”
According to CoinGecko, crypto’s overall market capitalization has lost over $80 billion since the lawsuits, representing a 7% dip in its market cap since the SEC’s strict enforcement actions this month.
Last week, the regulator accused Binance of multiple crimes including operating an unregistered exchange, mixing customer funds, and selling unregistered securities. This past spring, the Commodity Futures Trading Commission similarly sued Binance for operating a crypto derivatives exchange without a license, catalyzing $1.6 billion in losses for Binance.
June 12, 2023 Published by The Street News.