The US Securities and Exchange Commission's (SEC) legal actions against cryptocurrency exchanges like Binance, its US affiliate, Binance.US and Coinbase have sent shockwaves through the investor community.
The agency asserted that several crypto assets listed on these exchanges should be classified as securities rather than digital assets.
The tokens identified as securities have experienced significant price declines, with Binance's BNB, Polygon's MATIC and Cardano's ADA among the most affected.
The SEC accuses Binance, Binance.US, and CEO Changpeng "CZ" Zhao of violating federal securities laws. Coinbase, on the other hand, is accused of selling unregistered securities to the general public.
An alarming $4 billion in outflows in just four days have been reported by blockchain analytics companies Nansen and Glassnode. Binance, Binance.US, and Coinbase witnessed a net outflow of $3.1 billion through the Ethereum network, along with $864 million in bitcoin (BTC) between Monday and Thursday.
Despite the regulatory challenges, the exchanges have promptly processed withdrawals throughout the week, and no delays have been reported thus far.
Nansen data reveals that Binance, the world's largest cryptocurrency exchange by trading volume, experienced a net outflow of $2 billion on the Ethereum blockchain within just four days. This sum includes all Ethereum-based tokens, including ETH. Glassnode's data indicates that BTC withdrawals exceeded deposits by approximately 31,868 BTC ($838 million).
On Wednesday, Binance saw a substantial net outflow of 13,953 BTC, marking the largest daily drawdown since December. During that time, investor confidence was undermined by a faulty reserve report and the collapse of a rival exchange, FTX.
Although the outflows witnessed this week were considerable, they only represent about 5 per cent of all assets held on Binance, according to the exchange's crypto wallets.
Nansen reports that Binance.US experienced net outflows of $75 million from the Ethereum network. Since Glassnode does not track this exchange, tracking BTC outflows is challenging. Nevertheless, Binance.US has faced the full force of the SEC, which is seeking orders to freeze all .Binance.US assets.
In the case of Coinbase, Nansen data shows a net outflow of $1 billion on the Ethereum network from Monday through Thursday. Glassnode's data indicates $25 million worth of Bitcoin outflows from Coinbase.
UAE outlines vision for low-emission hydrogen economy at World Hydrogen Summit
India, US discuss trade as Rubio cites progress on Iran conflict
ENOC signs deal with Allied Biofuels to explore sustainable aviation fuel supply
Mexico, EU sign stalled trade deal as they aim to diversify from US
Dubai announces 5% VAT on Salik, Parkin fees
