Binance, the world’s largest cryptocurrency trading platform, has temporarily blocked cryptocurrency withdrawals after they reached nearly $2 billion in the past 24 hours, Reuters reported.
Binance, whose dominant position in the cryptocurrency market was strengthened by the bankruptcy of rival FTX in November, shared a report from auditing firm Mazars last week to show that it has enough bitcoins to cover customer deposits.
But some users of the trading platform were quite concerned that a Mazars report showed that Binance’s bitcoin reserves exceeded customer deposits in a single day in November.
The $1.9 billion withdrawal of USD Coin, a so-called “stablecoin,” by Binance in the past 24 hours is the largest outflow of capital from the trading platform since at least June.
In comparison, over the past 7 days, Binance recorded a total of $2.2 billion in withdrawals.
“Binance’s pullback is increasingly due to uncertainty surrounding its reserves report,” a spokesperson for crypto analytics firm Nansen told Reuters.
Concerns about Binance
The trading platform has already come under pressure from US authorities due to disagreements between Justice Department prosecutors in Washington, which delayed the release of the results of a criminal investigation into Binance’s compliance with US money laundering and sanctions laws.
The information, exclusively reported by Reuters on Monday, immediately sent the price of Binance’s digital token BNR down 4%.
Binance has announced that it has temporarily suspended USDC Coin withdrawals, saying they will be subject to a so-called “token swap,” a procedure in which digital token holders exchange their cryptocurrencies, usually using different blockchains.
In September, Binance announced that it would automatically convert its users’ balances and new deposits in USD Coin and two other cryptocurrencies into its own “stablecoin” called Binance USD.
Changpeng Zhao, the founder and CEO of Binance, said on Wednesday that converting USD Coin into two other tokens, Paxos Standard and Binance USD, requires using dollars in a bank in New York.
“Banks don’t open for several hours. We expect the situation to normalize when the banks open,” he said.
Source: Hot News
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