Is the Crypto Giant Dumping Solana and Ethereum? – CryptoNinjas

Key Takeaways:

• They have denied that they are selling tokens at scale, calling themselves a trading facilitator.
• They point to market maker Wintermute’s movements of crypto-assets before Solana’s large token unlock.
• Speculation rises amid market volatility, with concerns about potential selling pressure.

Rumors and speculation are common in the volatile world of cryptocurrency, but recent allegations against Binance, the largest crypto exchange by trading volume, have set off a firestorm. Are they secretly dumping their Solana (SOL) and Ethereum (ETH) holdings, causing the market to go wild? Here’s a look at what’s going on and why it matters.

The Claims Surface During a Market Downturn

The recent market downturn, worsened by the $1.4 billion Bybit hack, has driven Bitcoin’s price to levels not seen since November 2024, exacerbating investor fears. Such a drop made for a perfect breeding ground for speculation. Based on posts shared on social media, the rumor spread like wildfire that major crypto players, such as Binance, were driving the crash by quietly dumping their tokens via over-the-counter (OTC) trades.

Binance to the Rescue: “We’re Just Matching Trades”

These allegations have been vehemently refuted by Binance. “Binance hasn’t ‘dumped’ or ‘sold’ large amounts of tokens as some tweets have wrongly claimed. They are misunderstanding what Binance does as an exchange, which is we simply help users match trades,” an exchange representative told Cointelegraph. They are misunderstanding what Binance does as an exchange, which is we just help users match trades.

Simply put, this statement distills Binance’s role into that of a neutral intermediary — a marketplace which brings buyers and sellers together, not a market participant putting its finger on the scale. The exchange asserts that it does not influence users’ trading decisions, including those of market makers.

More News: Binance Review 2025: Is It Legit? What Are Binance Pros and Cons?

The Wintermute Factor: Dissecting A Market Maker’s Moves

A big part of the speculation is focusing on activity that involves Wintermute, a major crypto market maker. According to data obtained by Arkham Intelligence, Wintermute withdrew more than $38.2 million worth of Solana from Binance hot wallets over the 24 hours preceding Feb. 24, 2025.

Wintermute withdrew from Binance hot wallet. Source: Arkham Intelligence

What are Market Makers?

Market makers like Wintermute are integral to the crypto ecosystem, ensuring liquidity by continuously quoting bid and ask prices. This activity results in large token transfers between exchanges and wallets as they rebalance their inventory.

Solana Unlock: Potential Market Consequences and Speculation

Compounding the drama, these withdrawals came only days ahead of Solana’s much awaited $2 billion token unlock, slated for March 1, 2025. This will introduce more than 11.2 million SOL tokens into circulation, adding potential selling pressure to the market. Some speculate that Wintermute timed its withdrawals strategically to profit from the unlock, possibly by shorting the market.

Solana Unlocked: A High-Stakes Gamble?

Crypto analyst Artchick.eth stated that over the next three months, 15m+ of SOL (worth ~$2.5b) will enter circulation. Many of these tokens were purchased at $64 per SOL in FTX’s auctions by firms such as Galaxy Digital, Pantera Capital and even Figure.

$7.5B of SOL unlocks over the next three months, this is the largest unlock in history by far

The majority of this SOL was purchased from FTX auctions at $64 by Galaxy, still a very healthy profit

“But they are OTCing”

Yeah what do you think the OTC buyers are gonna do with… pic.twitter.com/QLd94nNS9H

— artchick.eth/acc 🔥👠 (@digitalartchick) February 16, 2025

These words were also echoed by crypto trader RunnerXBT, who called it a “dangerous” time to be buying Solana. RunnerXBT noted the anticipated profits for Galaxy Digital, Pantera and Figure, which are scheduled to unlock $3 billion, $1 billion and $150 million worth of SOL, respectively, if the market appreciates. This impending profit-taking could exert considerable pressure on the SOL price.

The Double-Edged Sword of Blockchain Transparency

Protecting user transaction data is crucial for regulatory compliance at all cryptocurrency exchanges and, while the transparency of blockchain is often hailed as one of the greatest benefits of cryptocurrencies, it is important to interpret transaction data with caution, as Binance emphasized. “While blockchain transparency is one of the best things about crypto, it’s important not to jump to conclusions about screenshots of transactions,” the spokesperson said. Finally, Binance urges users to familiarize themselves with the roles of exchanges and market makers before jumping to conclusions.

Amplification of the Influencers and the Power of Rumors

Certain prominent players in the crypto sphere helped spread rumors that Binance allegedly dumping its assets. Others such as Marty Party and Jacob King expressed skepticism and claimed several reasons why Binance would be behaving the way that they were. This prompted claims of possible market manipulation, which took off.

People – you are being shaken out by #Binance – don’t give them your assets – use their leverage flush to accumulate more assets and move to self custody. That’s how you win.

They will turn and flush the $billions of shorts 🩳 after they are satisfied enough longs and paper…

— MartyParty (@martypartymusic) February 28, 2025

More News: Changpeng Zhao Criticizes Binance’s Token Listing Process as “A Bit Broken”

Settlement by the United States Department of Justice

Some speculated that these sales were used to help Binance cover its $4.3 billion settlement with the U.S. Department of Justice (DOJ), though Binance has denied this. The exchange’s representatives claim that these transactions are traders’ strategies on the platform rather than internal sell-off activities.

Wintermute Responds

Wintermute has previously denied similar allegations, stating that their activities are solely driven by their own trading strategies and market analyses.

Impact on the Market at Large

The controversy around Binance comes at a delicate moment for the crypto market. With the market recovering from months of volatility and uncertainty, anything even remotely resembling manipulation can have a lasting effect on investor psychology. It would certainly widen spreads on the way down and create more price volatility, further destabilizing the markets. In such a scenario, fundamental market principles are inverted, creating more instability.

Identifying FUD and Fostering Awareness

However, Binance suggests users don’t fall for any FUD (fear, uncertainty, doubt) and learn about market forces. Taking the time to understand the roles of exchanges and market makers can help investors avoid making assumptions based on limited market insights.

This concludes the allegations against Binance by highlighting the intricate relationship between market phenomena, speculation, and transparency within the cryptocurrency realm. Though the exchange has denied any wrongdoing, the situation has served as a reminder for all crypto investors of the importance of due diligence and critical thinking.