According to crypto research firm Nansen, crypto investors withdrew a considerable amount of assets from the cryptocurrency exchange Binance over a 24-hour period, reaching $791.6 million. The announcement of 13 securities charges against Binance and its founder, Changpeng Zhao, by US regulators occurred shortly after this.
Investors had moved their money to multiple exchanges following the apparent collapse of FTX, a fake cryptocurrency exchange, with Binance being the platform of choice for many. However, it seems that some of those gains have been undone in light of the new Securities and Exchange Commission (SEC) accusations.
Investors removed $1.65 billion in assets from Binance and an extra $13 million from Binance’s U.S. division on the Ethereum blockchain after the allegations were made public. In contrast, just $871.8 million and $11.53 million, respectively, went into Binance and Binance. US.
The effect that regulatory measures may have on the Bitcoin industry is highlighted by this development. A noteworthy change in asset allocation occurred as a result of the allegations against Binance, and a sizeable sum of money was taken off of the platform.
It will be interesting to observe how Binance responds to these difficulties and whether it can win back investors’ confidence. The long-term viability and expansion of cryptocurrency exchanges are dependent on regulatory compliance and investor protection as the cryptocurrency sector continues to develop.
The Securities and Exchange Commission (SEC) has accused Binance and Changpeng Zhao, the company’s founder, of a number of significant offenses. Zhao’s businesses were charged with combining investor money with those of Binance, and the SEC claimed that Binance engaged in the unregistered offer and sale of securities.
Additionally, according to the SEC, Binance violated its own policies by permitting institutional U.S. investors to utilise the global exchange rather than the country-specific U.S. version, which was meant to be independent from the global operations.
Similar accusations of unlawful behavior and regulatory lapses were made against Binance earlier this year by the Commodity Futures Trading Commission (CFTC). The allegations have resemblances to Sam Bankman-Fried, the creator of FTX, and his exchange’s demise, notably in regard to commingling assets and regulatory issues.