Are Binance users headed for the exit? Spending over $1 billion—so far

Crypto exchange Binance and the company's CEO, Changpeng Zhao, have both pleaded guilty to criminal charges in the United States following the stunning revelation yesterday that the platform had siphoned off an estimated $3 billion in user funds.

Within 24 hours of Zhao agreeing to step down as Binance's CEO and plead guilty to violating US anti-money laundering laws, an estimated $2.83 billion of Binance's client funds were withdrawn from the transaction, according to data compiled on the chain, according to a Dune analysis.

During the same period, $1.81 billion worth of funds were repatriated to Binance, resulting in a one-day net loss of more than $1.01 billion in client funds for the world's largest crypto exchange.

While such losses are not substantial, they represent only a 1.8% dent in the total exchange rate of $56.4 billion. Also, it's not unprecedented: At two separate points this year, including one day earlier this month, net outflows from Binance's coffers exceeded $1 billion in a 24-hour period, according to Dune's dashboard.

Last November, the historic collapse of Binance's then-rival FTX, and fear of despair and an industry-wide crisis, saw Binance more than double its current net inflows—$2.65 billion in a six-day period.

Fears that the company could immediately begin banking on Binance following its historic settlement with the US government appear to be unfounded, at least for now. For reference, after FTX began circling the drain last November, it took an estimated $6 billion in panicked customer withdrawals to trigger a once-in-a-lifetime disaster for the exchange. Remember FTX back then was about half of what Binance is now.

Yesterday, in his first public statement since pleading guilty to criminal charges in federal court in Seattle, Binance's Zhao insisted US prosecutors say Binance did not misappropriate user funds or engage in market manipulation. fall out.

“Funds are SAFU,” Zhao concluded yesterday's post, referring to a consumer-secured asset fund he set up to repay clients in the event of an emergency. The contents of that fund, however, currently total $1.01 billion — not much more than foreign currency gains today.

He was taken to jail after pleading guilty, but was released on a $175 million bond.

Edited by Stacy Elliott.