Yesterday, the United States Commodity Futures Trading Commission (CFTC) accused Binance of regulatory violations. However, just before the CFTC accused crypto exchange Binance and its CEO Changpeng Zhao, nearly $1 billion in cryptocurrency reportedly left the platform’s wallets. According to Thanefield Capital’s data research, substantial funds were withdrawn from platforms such as Binance, Kraken, Coinbase, and Bitfinex in the 12 hours preceding the CFTC indictment on March 27 at 3:00 pm UTC. Notably, more than half of the funds (roughly $850 million) were withdrawn from Binance alone.
Additionally, one hour after the announcement, Binance saw an additional $240 million withdrawn. Nansen’s data shows that over $400 million in Ethereum-based funds have been withdrawn over the past 24 hours. Nonetheless, Binance still holds a significant amount of crypto assets worth $63.36 billion, including $2 billion USDT, $17 billion BTC, and $8.1 billion ETH.
The Commodity Futures Trading Commission (CFTC) filed a lawsuit against Binance and its founder, Changpeng Zhao, in the U.S. District Court for the Northern District of Illinois. According to the CFTC, which has been investigating Binance’s activities since 2021, the company failed to comply with regulatory obligations by not registering with the derivatives regulator. It is alleged that Binance has been conducting transactions involving Bitcoin, Ether, and Litecoin (LTC) on behalf of U.S.-based customers since at least 2019.
Furthermore, the IRS and federal prosecutors have been examining Binance’s compliance with Anti-Money Laundering regulations while the Securities and Exchange Commission has been looking into whether the company allowed American traders to access unregistered securities. Zhao has rejected these allegations, asserting that Binance “does not trade for profit or engage in ‘market manipulation’ under any circumstances.”
