The CEO of Binance, Changpeng Zhao (CZ), has offered a different perspective on the recent reports of increased outflows from the exchange following the SEC lawsuit. While analytics platforms such as Nansen and DeFiLlama have noted a surge in exchange outflows from Binance in the past week, CZ argues that these figures may not present an accurate picture of the situation.
According to Nansen, approximately $2.36 billion has left Binance in the last seven days, along with $123.7 million from Binance.US. DeFiLlama reported an even higher outflow estimate of $3.35 billion, while Glassnode data indicates a 5.7% decrease in Binance’s BTC balance, equivalent to around $1 billion, over the same period.
However, CZ took to Twitter on June 10 to provide his viewpoint, suggesting that certain third-party analytics platforms consider changes in assets under management as “outflows.”
This approach can lead to distorted data, as it includes instances where crypto prices decline. Instead, CZ pointed out that Binance’s outflow in the past 24 hours on June 9 was approximately $392 million, significantly lower compared to the $7 billion outflow recorded during FTX’s collapse last year.
CZ emphasized that during periods of volatility, significant inflows and outflows are common. He clarified that some analytics platforms only focus on outflows and disregard inflows. On days with substantial price movements, many arbitrage traders transfer large amounts of funds between exchanges, often surpassing the average volumes seen on regular days.
Since June 6, when the SEC initiated legal actions against Coinbase and Binance, the overall cryptocurrency market capitalization has declined by 7%, exceeding $80 billion.Additionally, on June 9, it was highlighted that decentralized finance (DeFi) volumes witnessed a surge of over 400% following the lawsuits targeting centralized exchanges.
CZ’s perspective provides an alternative interpretation of the exchange outflow data, indicating that the situation might not be as worrisome as initially portrayed.
Also Read: SEC Slaps Binance and CEO Changpeng Zhao with 13 Charges
