In a recent turn of events, Binance, the world’s largest cryptocurrency exchange, is grappling with significant challenges following the resignation and guilty plea of its founder and CEO, Changpeng Zhao.
Within the last twenty-four hours, outflows from Binance, excluding bitcoin, have surpassed $1 billion, according to data from blockchain analysis firm Nansen.
A CNBC report highlighted a sharp 8% decline in the native token of the exchange, BNB, within the same timeframe.
Data from Nansen indicates that Binance holds BNB tokens valued at approximately $2.8 billion.
The exchange’s market share in spot trading took a hit in March after discontinuing zero-fee trading for various crypto asset pairs, including bitcoin, a move that had previously incentivized customers.
The conclusion of years-long inquiries into Binance resulted in a plea deal, with the United States government collecting $4.3 billion in penalties from the exchange.
Despite the turmoil, Binance remains the largest cryptocurrency exchange globally, boasting an annual trading volume in the billions.
Current outflows, although substantial, have not triggered a “mass exodus” of funds, with over $65 billion in assets still held on the platform, as reported by Nansen.
Market analysts, including Grzegorz Drozdz from investment firm Conotoxia Ltd, noted that while the BNB token suffered a significant loss, 98 out of the top 100 cryptocurrencies experienced a noticeable rebound within the past 24 hours.
Bitcoin, after initially falling 4%, recovered but retained a 1.3% loss.
Despite the challenges, experts interviewed by CNBC express optimism about Binance’s survival, citing the company’s compliance with the Department of Justice (DOJ) process, the implementation of a three-year strategy to enhance operational compliance, and the substantial value of assets in the company’s reserves.
Interestingly, the stability of the naira in the cryptocurrency market has persisted despite the $4.3 billion settlement with U.S. authorities.
On Binance, the naira has maintained a trading range of N1120 to N1150 against the dollar, as reported by Nairametrics.
