A few days after the U.S. Department of Justice (DOJ) announced it had imposed a $4.3 billion fine in a settlement with crypto exchange Binance, the jury is still out on whether it has caused a major shake up at the firm.
In the 12 hours that followed the news, on-chain analytics firm Nansen said there was no real sign of a “mass exodus of funds” in a post on X.
Here's our latest update on @binance, 12 hours after our previous one
At the time of writing, withdrawals are continuing, and we're not seeing a mass exodus of funds
Over the past hour on Ethereum, Binance has a $17M negative netfow (more leaving the exchange than what's… pic.twitter.com/yQPtMl5ue8
— Nansen 🧭 (@nansen_ai) November 22, 2023
“In the past, Binance has processed higher volumes of outflow and negative netflow: Jun 2023 after the SEC sued Binance, December 2022 after insolvency rumors, and the immediate aftermath of FTX,” said Nansen in a post.
Things appeared to have changed considerably after another 12 hours had passed. Data from 21.co shows Binance saw $2.2 billion worth of outflows, suggesting at least some retail investors were spooked enough to move their coins off the exchange.
However, the firm still had more than $58 billion in total assets, of which $10 billion was in stablecoins.
— Ξliézer Ndinga (@elindinga) November 21, 2023
Now, data from CryptoQuant seemingly indicates that some of these funds have been flowing out of Binance and making their way onto rival crypto exchange Coinbase.
Analysts identified a flow of funds between the two exchanges, with Coinbase’s reserves increasing around 12,000 BTC over the same period that Binance’s reserved decreased by 5,000 BTC.
“The market is still nervous about the recent legal implications against Binance. In the short term, we will see more users move funds to compliant or licensed exchanges for peace of mind,” said Greta Yuan, head of research at Hong Kong-based digital-asset platform VDX to CoinDesk earlier today.