Data from Nansen, an analytics firm revealed that clients withdrew nearly $3.6 billion in assets from Binance in just seven days, including nearly $2 billion in a single day.
Binance, a cryptocurrency, and digital asset trading platform is understood to have clocked a substantial increase in trading post-Sam Bankman-Fried’s FTX collapse, this November. According to a report by Cryptocompare, a market analysis firm, Binance has grown its derivatives trading market share to 67.2% and its overall market share to 52.9%. “The 24-hour trading volume at Binance stands at roughly $671 billion, the highest in the world. The kind of trading volume Binance has witnessed in a bear market is a sign of a strong ecosystem with high liquidity within the system,” Dhruvil Shah, senior vice president, technology, Liminal, a digital wallet infrastructure platform told FE Blockchain.
One of the largest cryptocurrency exchanges, Binance saw a 30% increase in trading just last month. “The FTX and Binance situation has attracted much attention with celebrity investor Kevin O’Leary testifying before the Senate Banking Committee claiming that Binance was allegedly involved in the collapse of FTX,” Shivam Thakral, CEO of BuyUcoin, a cryptocurrency trading platform, added.
Furthermore, industry analysts are quick to point out that post the FTX scandal, consumers are suspicions and cautious of investing in cryptocurrencies. “The fall of FTX has given Binance the chance to publicly establish its credibility with regulators and investors. In an effort to increase transparency, Binance made its assets and wallet addresses public. Binance has initiated its proof-of-reserve process after its auditor decided to halt audits for all its cryptocurrency clients,” Tarusha Mittal, chief operating officer (COO) and co-founder, UniFarm and Dapps, a group staking platform, said.
Meanwhile, data from Nansen, an analytics firm revealed that clients withdrew nearly $3.6 billion in assets from Binance in just seven days, including nearly $2 billion in a single day. In terms of volume, Binance is said to be the largest cryptocurrency exchange in the world. Binance Coin ranked in the top ten most expensive cryptocurrencies in 2022.
Caption: Biggest cryptocurrency exchanges based on trade volume market share from August 2021 to December 6, 2022. | Source: Statista
Interestingly, off-late Binance too seems to have hit a rough patch with regulators in various countries. For instance, regulators at the Commodities Future Trading Commission are running an investigation to find whether Binance was involved in ‘insider trading’ or market manipulation through trading on customers’ orders before executing it. While in the UK the Financial Conduct Authority said that the UK affiliate was operating without any approval. Japan too cited a similar issue. “One must be vigilant as Binance has an offshore jurisdiction and does not have the same level of regulatory oversight as many other exchanges to ensure that your funds are kept secure,” Shah added.