In a ripple effect following the Securities and Exchange Commission (SEC) lawsuits against Binance and Coinbase, users have withdrawn billions of dollars across multiple chains. A recent analysis by blockchain data and research company Nansen.ai provides a deep dive into the aftermath of the regulatory storm.
It's been 24 hours since the SEC sued @binance. Binance users have withdrawn over $3B across multiple chains since the announcement, resulting in $1.43B negative netflow as of 3pm UTC today
But what does this all mean?
We'll show what you need to see using on-chain data… pic.twitter.com/2AcAc2OrW0
— Nansen 🧠(@nansen_ai) June 6, 2023
After the SEC lawsuit against Binance, the platform experienced over $3 billion in withdrawals, resulting in a negative net flow of $1.43 billion as of 3 pm UTC. In simpler terms, more assets were withdrawn from Binance than what was deposited, indicating a significant shift in user behavior.
Comparing Binance and Coinbase
In the 24 hours following the SEC lawsuits, Binance and Coinbase experienced net outflows of $491.9 million and $105.3 million, respectively. However, these figures were less dramatic than the net outflows seen when Binance was first sued by the SEC.
Despite these substantial withdrawals, Binance holds over $54 billion across their known wallets, with $17 billion on Ethereum. Ethereum withdrawals represent less than 10% of total funds across known wallets, demonstrating the platform’s resilience.
The top three wallets in terms of net withdrawals belong to leading institutional investors Cumberland and Brevan Howard Digital. This could be indicative of institutional concerns regarding regulatory scrutiny.
With the SEC now suing Coinbase, on-chain data shows that Coinbase and Coinbase Custody have negative net flows of $1.28 billion. This indicates a significant financial shift in the platform following the legal action.
Looking Back and Looking Forward
The SEC signaled earlier this year that it was investigating Binance and Coinbase, so the lawsuit news may have been factored into the price. However, Nansen.ai’s trading indicators have been signaling a potential sell-off since April 2023.
The ripple effects of the SEC’s lawsuits against Binance and Coinbase are far-reaching. What do these significant net outflows signify for the future of these exchanges and the broader crypto market? How will these platforms adapt to this new regulatory landscape? Only time will tell!
Source: https://coinpedia.org/news/sec-trigger-massive-withdrawals-unfolding-the-state-of-binance-and-coinbase-post-lawsuit/