The cryptocurrency exchange’s net withdrawals reached $788 million in the previous 24 hours, although Binance assured Cointelegraph that “funds are SAFU.”
Binance, a cryptocurrency exchange, has experienced a jump in withdrawals in the last 24 hours, as investors appear to be concerned about recent regulatory action against Paxos and its stablecoin Binance USD.
At the same time, the BUSD token has seen considerable redemptions, with Peckshield reporting 342 million BUSD burnt in the previous 24 hours.
The Securities and Exchange Commission (SEC) issued a notice of prospective enforcement action against Paxos on February 12. It claimed the stablecoin is an unregistered security, which Paxos rejects.
According to data provided by the blockchain intelligence platform Nansen, Binance experienced $788.5 million in 24-hour multichain token net outflows, with outflows of $2.7 billion outpacing inflows of about $1.97 billion.
It’s the highest 24-hour net outflow since December 17, 2022, when its proof-of-reserve audits were withdrawn from auditor Mazars’ website, according to Dune analytics data.
The New York Department of Financial Services (NYDFS) ordered Paxos to cease the issuing of BUSD on February 13 in response to the SEC’s action and an alleged tip-off from USD Coin issuer Circle.
The withdrawals and token burning appear to be a reaction to the events, with crypto users fleeing the stablecoin for fear of more governmental action.
Binance’s reserves include the most BUSD, at $14.4 billion, or over 90% of the stablecoin’s current market cap of $16.1 billion.
The crypto exchange also has roughly $60 billion in reserves, with BUSD accounting for 22% of that total.
Binance informed Cointelegraph that “funds are SAFU” — backed by a Secure Asset Fund for Users — reiterating what Binance CEO Changpeng “CZ” Zhao announced earlier that day on February 13.
