Ki Young Ju believes Binance’s on-chain activity looks normal for now, even as CZ says things have stabilized.
In a tweet yesterday, CryptoQuant chief Ki Young Ju asserted that he could not see any alarming on-chain activity from Binance that could indicate that the exchange was in trouble.
According to the analyst, while the exchange saw its BTC reserves drop by 8% in 48 hours, the same reserves grew by 24% in November during the FTX bank run. In addition, Ki Young Ju implied that the Binance stablecoin reserves looked more “organic” than FTX, which tanked by 93% in the days leading up to the bank run.
People are asking me if @binance is fine.
Their $BTC reserve dropped -8% over the last two days but +24% up during the FTX bank run last month.
— Ki Young Ju (@ki_young_ju) December 13, 2022
The statement from the analyst comes after the leading crypto exchange saw a surge in withdrawals over the last two days. The exchange saw at least $1.9 billion in withdrawals yesterday, per an Aljazeera report.
As reported by The Crypto Basic, the crypto exchange recorded its largest 24 hours BTC outflow, with over 39k BTC worth over $700 million, leaving the exchange yesterday.
Panic ensued after Binance announced that it was temporarily halting USDC withdrawals, leading users to question the health of the crypto exchange. Notably, the suspension of withdrawals by centralized crypto platforms in recent months has usually indicated insolvency troubles. Moreover, it did not help that a Reuters report the day before had implied that the US Department of Justice was about to file criminal charges against the exchange and its executives.
Binance had assured users that it was simply carrying out a token swap which Changpeng Zhao explained required going through a New York bank that was closed at the time. However, after recent industry collapses, several users opted to withdraw their holdings as a precaution.
Things Have ‘Stabilized’ Says CZ
It bears mentioning that today, Binance chief Changpeng Zhao asserted in a tweet that things have stabilized, and the crypto exchange is now seeing inflows. According to the Binance chief, the crypto exchange had seen significantly higher outflows during LUNA and FTX collapses.
Things seem to have stabilized. Yesterday was not the highest withdrawals we processed, not even top 5. We processed more during LUNA or FTX crashes. Now deposits are coming back in. 🤷♂️💪 https://t.co/WLK2KyCym0
— CZ 🔶 Binance (@cz_binance) December 14, 2022
Yesterday, the crypto billionaire had described the surge in withdrawals as a “stress test” which would ultimately build investor confidence. “Business as usual for us,” CZ asserted.
In addition to his tweet today, the Binance chief left a hash code of a prediction that he plans to reveal in a couple of years if accurate. When he reveals it, users can use a hash code algorithm to verify the hash.