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As per crypto analytic firm Nansen, crypto giant, Binance witnessed a negative netflow of a whopping $778 million on the Ethereum (ETH) blockchain following the United States Securities and Exchange Commission (SEC) lawsuit against the exchange.
The SEC filing against Binance had a significant impact not only on digital assets but the balance sheet of Binance as well. According to the data from Nansen, the netflow comprises of approximately $871 million worth of assets that inflowed onto the exchange while $1.6 billion worth of assets went out of the exchange. On June 6, Nansen took to Twitter to reveal the predicament, citing,
“Netflow to Binance over the past 24 hours is $778.6M negative on Ethereum – $871.7M in and $1.65B out Over the past hour, netflow on Ethereum continues to be negative at $35.7M on Ethereum – $14.8M in and $50.5M out.”
Netflow to Binance over the past 24 hours is $778.6M negative on Ethereum – $871.7M in and $1.65B out
Over the past hour, netflow on Ethereum continues to be negative at $35.7M on Ethereum – $14.8M in and $50.5M out
Track it here https://t.co/nwTgpXWhZY and filter for "Binance" pic.twitter.com/jnNAN0QKVy
— Nansen 🧭 (@nansen_ai) June 6, 2023
Binance Balance Sheet Sees Substantial Drop
In the first 24 hours following the SEC lawsuit, Ethereum-based tokens have seen a negative netflow, where in the past hour, $14.8 million worth of assets flowed in, and $50.5 million worth of assets went out of the exchange.
In addition, Binance’s reserve assets also had a net outflow of approximately $1.4 billion, accounting for almost 2.6% of its total reserve assets of $52.9 billion. Meanwhile, in the same time period, Binance’s U.S. affiliate exchange registered net outflows of $13 million.
Here are the top depositors and withdrawers in the past hour
You can find them by going to "Exchange Flows", "Wallets" and then scrolling down to "All Wallets" pic.twitter.com/gDnXn6RJRB
— Nansen 🧭 (@nansen_ai) June 6, 2023
The SEC vs Binance feud has rattled the entire crypto ecosystem with Bitcoin (BTC) plunging below the $26K level. Its largest peer, Ethereum (ETH) also slipped 2.77% in the last 24 hours but remained above $1,800-levels. Majority of altcoins were in deep red, falling in tandem. The lawsuit against the largest cryptocurrency exchange also impacted other crypto outfits as well.
Coinbase Global Inc witnessed a significant drop of 10.3% in its share value. Similarly, MicroStrategy, a company renowned for accumulating Bitcoin (BTC) also experienced a significant drop in its shares, declining nearly 9% to $276.36 per share.
Furthermore, Bitcoin mining stocks including Riot Platforms, Marathon Digital Holdings and Bitfarms Ltd have also suffered significant losses. Specifically, Riot Blockchain and Marathon Digital both sank more than 9%, while Bitfarms declined more than 6%.
War on Crypto will have Devastating Impact
It seems the SEC has taken its war agianst the digital assets industry to a new level. After targeting numerous crypto focused companies over the past few months, the regulatory agency has now filed a suit against Binance, accusing the exchange giant of violating securities laws. Owing to this organised cleansing of the crypto sector, John Reed Stark, a former chief of the SEC’s Office of Internet Enforcement noted,
“This is yet another targeted attack that is devastating in the crypto ecosystem. Pretty soon, the SEC won’t have anyone left to sue.”
The latest development between Binance and SEC has spooked the global crypto market resulting in a bloodbath across digital assets. It is likely the market will continue to respond sharply as the Binance-SEC saga unfolds. In a statement, Shivam Thakral, CEO of BuyUcoin suggested, “We should brace ourselves for a choppy market in the coming weeks. Regulatory clarity is the need of the hour for the global crypto ecosystem.”