According to blockchain data tracker Nansen, investors have withdrawn $1.6 billion in cryptocurrency from Binance since it was charged by the US CFTC on Monday.
The largest cryptocurrency exchange in the world, Binance, as well as its CEO and previous top compliance officer, were sued by the U.S. Commodity Futures Trading Commission (CFTC), who claimed they were running a “illegal” exchange and a “sham” compliance program.
Numerous serious accusations were made against the business in the CFTC complaint, one of which was that Zhao had instructed Binance staff members to use VPNs to conceal their whereabouts. The agency also raised long-standing accusations that the business had not successfully implemented know-your-customer safeguards or stopped money laundering on its network. The agency also claimed that in order to run Binance without the necessary legal protections, the exchange depended on a “maze of corporate entities.”
Binance has seen $1.6 billion in total transfers since the litigation, including $852 million in the previous day, according to Nansen. This is an increase from the $385 million per day average over the previous two weeks.
The withdrawals were higher than normal, according to Martin Lee, a research expert at Nansen, but they were still lower than on December 13, when investors withdrew $3 billion from Binance as they grew concerned about the company’s reserve situation.
The business cited Nansen statistics that revealed its on-chain inventory of various crypto assets, including bitcoin and USDT, totaled $64 billion. Another 10% of its assets were BUSD stable coins, from which Binance recently declared that it must “move away” after authorities reprimanded its creator Paxos.