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Binance Faces Increased Stablecoin Withdrawals in a Single Day

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Stablecoin withdrawals from the centralized exchange, Binance, have been on a high in the past few days, recording over $1 billion outflows in USDC in a single day this week.

There has been an increase in the number of USDC withdrawals from the Binance exchange in the past few days. 

Binance is the world’s largest centralized exchange and is considered among the most trustworthy cryptocurrency exchanges in the world. 

According to data from the crypto index website Coingecko, the Binance exchange has a trust score of 10, with an average of over $13 billion in 24-hour transaction volume carried out on the platform as of the time of writing. 

Even with this huge customer base, recently there have been increased withdrawals from the platform. According to statistics from glassnode, the number of net inflows and net outflows into and from the Binance exchange has been dwindling. 

binance stablecoin withdrawals
Source: glassnode

The net inflow is used to describe the number of stablecoins sent into the exchange, while the net outflow is used to describe the overall amount of stablecoin transferred out of the exchange into other platforms. 

However, data shows that this increased rate of stablecoin withdrawal from exchanges is not only peculiar to Binance alone. There has been an increased rate of stablecoin withdrawals from exchanges worldwide at alarming rates. 

This is shown in the image below, indicating a drop in the number of stablecoins stored in hot wallets. This increase in the trend, according to the data, started in the month of September. 

Source: glassnode

U.S Regulators request for Binance anti monetary laundry probe

The founder and CEO of Binance, Changpeng Zhao has been facing a regulatory probe from the U.S. Department of Justice with charges filed since December 2020. 

According to reports by Reuters, the federal regulators asked for documents that indicated the internal records of the transactions done on the exchange, including records of illegal transactions detected. 

The justice department also requested messages from Binance CEO, CZ, and 12 other board members concerning the detection of illegal monetary transactions carried out on the exchange by U.S customers. 

According to sources, the U.S. Department of Justice is trying to investigate whether or not Binance complied with the U.S. Bank Secrecy Act, which requires every crypto exchange to register with the Treasury Department and follow the anti-money laundering regulations set by the department if conducting any substantial business in the United States.

Also Read:  Is Mara Wallet Really Worth the Hype?

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Bio Francis is a seasoned blockchain content writer with a unique interest for everything related to cryptocurrency, blockchain and marketing.

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