Binance CEO Refutes Claims That The Exchange Spent $2 Billion On Buying The Bitcoin Dip.
CEO Changpeng Zhao commonly known as CZ has clarified that Binance didn’t buy any Bitcoin over the weekend.
Over the weekend, a few news websites went all out to claim that the Binance exchange was buying the Bitcoin dip. This was at a time was BTC’s price had fallen below the $20k mark. Apparently, the reports cited an instance where Binance transferred around 101,266 BTC to a cold wallet. The exchange doesn’t deny transferring the coins but refutes any suggestion that it bought the dip.
Cold Wallets
Crypto cold wallets have been a relatively popular option for crypto storage, especially by whales or top exchanges. Basically, cold wallets are wallets that are kept offline. They’re mainly in the form of hardware devices that can be plugged into a computer.
These are different from hot wallets that are kept online with an active internet connection. For example, trading taking place on exchanges is on hot wallets. While, exchanges mostly keep their funds in cold wallets as security away from the internet to avoid any hacking attempts.
What Happened?
According to a recent tweet by Binance CEO CZ, the exchange was merely transferring its BTC holdings to a cold wallet due to more users buying the crypto on the exchange. Granted, crypto investors are known to accumulate more holdings during downturns, and this may have been the case when BTC dropped to below $20k and $19k over the weekend.
“Another wrong article. When cold wallet increases, it means more users deposited to #Binance.”
Another wrong article. When #Binance cold wallet increases, it means more users deposited to #Binance. This journalist doesn't seem to under the concept of cold wallets for exchanges. ?
» Breaking: Binance Buys The Dip, Adds 101,266 Bitcoin https://t.co/RbrAHiUL2t
— CZ ? Binance (@cz_binance) June 19, 2022
As a matter of fact, the drop caused a buzz in the crypto community, especially crypto Twitter, calling for the bottom. It’s safe to assume that a lot of investors moved in to accumulate, and this gives credence to CZ’s explanation.
Bitcoin Price No Longer Under $20k
While the weekend, especially Saturday, was a painful moment for Bitcoin, the crypto seems to have gathered its strength and made its way back up to the $20k range before pulling back to just a little under $20k. Bitcoin is currently trading at $19,903.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic’s opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
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