The US Securities and Exchange Commission (SEC) has unleashed a massive campaign, taking Binance and Coinbase to court in recent days. While the battle promises to be long, it has had a direct effect on the two exchange platforms. They have seen significant withdrawals from their users over the last few days
The SEC attacks Binance and Coinbase, users flee
Will the SEC’s moves against Binance and Coinbase affect the funds of exchange platform users? That seems to be the fear of the community, especially as the SEC has just requested a freeze on the assets of Binance US.
It would appear that massive withdrawals are under way on both exchange platforms. According to analysis firm Nansen, withdrawals from Binance alone amount to more than $1.4 billion, spread across several blockchains:
It’s been 24 hours since the SEC sued @binance Binance users have withdrawn over $3B across multiple chains since the announcement, resulting in $1.43B negative netflow as of 3pm UTC today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
Withdrawals from Coinbase are also very high. They have totalled $1.2 billion since the announcement, again according to Nansen data. We are therefore seeing an exodus of investors, who fear that their funds will be blocked on the platforms.
Binance users are withdrawing funds en masse since the announcement
Given that we have just learned that the SEC wants to freeze funds on Binance US, we are likely to see a continuation of these withdrawals in the coming hours.
Crypto community reacts to SEC attacks
The SEC has mounted a progressive campaign in recent months, led by Gary Gensler. The fall of FTX – and Sam Bankman-Fried’s links to the US Democratic Party – have indeed prompted the regulator to attack the cryptocurrency sector.
Binance and Coinbase are the two most promising platforms in the US, so the legal battle ahead could be a long one. For his part, Brian Armstrong, Coinbase’s CEO, pointed out that the company’s efforts to register with the SEC had been in vain, and that dialogue had been cut off between the financial regulator and the exchange platform.
Notably, the Bitcoin price has been on the rise since yesterday, despite the successive announcements. It jumped by 8% overnight:
Bitcoin’s price jumped overnight
We are probably only at the beginning of what will be one of the most important developments in the ecosystem this year. Will exchange platforms emerge stronger? That’s the hope of the crypto community
