Binance, the popular cryptocurrency exchange, has seen little change in its total asset holdings following the recent settlement of civil and criminal charges between the company and CEO Changpeng “CZ” Zhao and U.S. authorities.
According to a report by blockchain analytics firm Nansen, there hasn’t been a significant outflow of funds from the exchange despite the settlement. The analysis revealed that within 24 hours of the U.S. Department of Justice announcing a $4.3 billion settlement with Binance, there was a net outflow of approximately $956 million worth of Ethereum. However, Binance’s overall holdings have actually increased and now exceed $65 billion.
No Mass Exodus of Funds
Nansen emphasized that while withdrawals are ongoing, there hasn’t been a mass exodus of funds from Binance. The report compared the current situation to previous instances when the exchange experienced higher outflows and negative netflows.
“In the past, Binance has processed higher volumes of outflow and negative netflow: June 2023 after the SEC sued Binance, December 2022 after insolvency rumors, and the immediate aftermath of the FTX incident.”
The report also highlighted that Binance’s holdings of Tether’s USDT decreased by approximately $246 million in the past 24 hours. However, holdings of XRP and TrueUSD (TUSD) have remained relatively steady during the same period.
Leadership Transition and Confidence
On November 21, Binance reached a plea deal with U.S. officials, allowing the exchange to continue operating under regulatory scrutiny. As part of the settlement, CZ stepped down as CEO and Richard Teng, Binance’s global head of regional markets, took over the position.
Teng expressed confidence in Binance’s strong fundamentals following the settlement and leadership transition. He also hinted at the exchange’s ability to pay the $4.3 billion fine imposed by the U.S. Justice Department.
“Binance’s strong fundamentals are intact following the settlement. We are confident in our ability to fulfill the financial obligations imposed on us.”
Recently, Binance wallets moved $3.9 billion worth of Tether (USDT) as part of an upcoming transaction related to the exchange’s pending $4.3 billion penalty. The majority of these funds were transferred between Binance cold wallets. Currently, Binance’s cold wallet holds a total of $6.6 billion, consisting of $4 billion in USDT and the remainder in various stablecoins.
Binance has previously stated that its cold wallets hold the majority of the company’s funds. However, it remains unclear how the company plans to utilize these funds to settle the imposed fine. Whether Binance intends to convert the USDT into U.S. dollars or another fiat currency is yet to be determined.
