While the data suggests that crypto assets have been flowing out of centralized exchanges at a brisk pace over the past week, Binance CEO Changpeng Zhao argues that it may not be as bad as it seems.
Major analytics platforms such as Nansen and DefiLlama have measured an increase in Binance outflows over the past seven days.after breaking the news of the Securities and Exchange Commission’s lawsuit against the company.
According to nansen, there has been a net outflow of $2.36 billion from Binance in the last seven days, along with $123.7 million from Binance.US.
defillama reported of an even larger $3.35 billion in Binance outflows, while Glassnode data shows that the balance of BTC of the exchange has decreased by 5.7% or around $1 billion in the last seven days.
However, in a June 10 Twitter post, CZ argued that some exchange output data may be skewed, as some third-party analytics measure the change in assets under management as “output,” which would include times when cryptocurrency prices decline..
According to our data, last 24 hours, @Binance net outflow is about $392m.
Our wallet addresses are public. Some 3rd party analytics measure Change in AUM (asset under management) in USD equivalent as outflow. This would include crypto price drops (which decrease AUM) as “outflow”.…
— CZ Binance (@cz_binance) June 10, 2023
According to our data, in the last 24 hours, the net flow of @Binance is about $392 million. The addresses of our wallets are public. Some third-party analytics measure the change in AUM (assets under management) in USD equivalent as output. This would include cryptocurrency price declines (decreasing AUM) as “outflow”…
CZ claimed that the outflow from the firm in the last 24 hours on June 9 was around $392 million.which pales in comparison to the $7 billion in one-day outflow that was recorded last year in November, at the time of the FTX collapse.
CZ went on to explain that large entries and exits are perfectly normal in times of volatility..
“Some even only measure the outputs, not the inputs. On a strong price day like today, many arbitrage traders move a lot of funds between exchanges, usually exponentially more than on normal days.”
Since the SEC’s lawsuits against Binance and Coinbase on June 5-6, total crypto market capitalization has declined by 7%, or more than $80 billion.according to CoinGecko.
On June 9, Cointelegraph reported that decentralized finance volumes surged more than 400% following twin lawsuits targeting centralized Andreessen Horowitz (a16z) to open its first non-US office this year.
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