The crypto market has faced turbulence in recent weeks, with Binance Bitcoin and Ethereum sell-off sparking concerns. Many fear the world’s largest crypto exchange may have played a role in the downturn by offloading massive amounts of Bitcoin and Ethereum.
These concerns originated from a claim made by a market analyst, AB Kuai. Dong (@_FORAB) on social media platform X. According to him, Binance had allegedly been reducing its holdings of major cryptocurrencies, including Bitcoin, Ethereum, Solana, and BNB, contributing to the market’s instability.
Did Binance Trigger the Crypto Market Crash?
Bitcoin has been on a rollercoaster ride since early February. It first dropped to $92,000 on February 3 before temporarily recovering to $98,000 by February 11. However, the momentum did not last, and Bitcoin has since struggled, now hovering around $95,000.
Ethereum has also been affected, slipping below $2,470 during Bitcoin’s drop. Many traders believe Binance’s alleged sell-off may have worsened the decline. On-chain data suggests that Binance’s Bitcoin holdings decreased by 94.1% between January and February. The Ethereum outflow was even more drastic, with a 99.9% reduction. Other cryptocurrencies like BNB and Solana also saw declines of 16.6% and 99%, respectively. Additionally, stablecoins like Tether (USDT) saw a reduction of 99.9% in Binance’s reserves.
Interestingly, reports indicate that these assets were primarily from Binance’s past revenue rather than user funds. Instead of disappearing from the market, much of the cryptocurrency sold was allegedly converted into USDC, whose holdings in Binance’s wallets increased by 57.5%.
Binance’s Response to Market Crash Allegations
The claims of Binance’s sell-off quickly gained traction, with traders and investors seeking explanations for the ongoing market slump. Many feared that a massive sell-off by Binance, a key player in the industry, could have devastating consequences for Bitcoin and Ethereum.
However, Binance swiftly responded to the allegations, denying any involvement in the price drops. In an official statement posted on X, Binance clarified that what appeared to be a sell-off was actually an internal accounting adjustment within its treasury. The exchange reassured users that their funds remained safe and secure and that no mass liquidation had taken place.
Market Outlook and Current Prices
Despite Binance’s reassurances, the market remains volatile. As of now, Bitcoin is trading at $95,740, reflecting a 2.6% decline in the past 24 hours. Meanwhile, Ethereum is priced at $2,600, marking a 4.2% drop in the same period.
With concerns still lingering, investors are closely monitoring Binance’s activities. Whether the exchange’s explanation will ease market fears remains to be seen. For now, traders should stay cautious and keep an eye on further market developments.
