Binance Crypto Withdrawals Spike Before CFTC Accusations

On March 27th, the United States Commodity Futures Trading Commission (CFTC) filed a suit against Binance, accusing the crypto exchange of regulatory violations. The accusation, however, did not come without warning. Shortly before the indictment was made public, almost a billion dollars worth of cryptocurrency was reportedly withdrawn from Binance’s wallets. According to data from Thanefield Capital, the withdrawals were substantial and occurred within hours of the announcement.

In the 12 hours leading up to the indictment, a total of almost $1.5 billion was withdrawn from platforms such as Binance, Kraken, Coinbase, and Bitfinex. Of that amount, more than half, or $850 million, was withdrawn from Binance alone. One hour after the announcement, Binance saw an additional $240 million withdrawn. According to data from Nansen, in the past 24 hours, more than $400 million in Ethereum-based funds were withdrawn.

Despite the withdrawals, Binance still holds an impressive $63.36 billion worth of cryptocurrency assets. These assets include over $2 billion worth of Tether (USDT), $17 billion worth of Bitcoin (BTC), and $8.1 billion worth of Ether (ETH).

The CFTC’s accusations against Binance and its CEO Changpeng Zhao include failing to meet regulatory obligations by not properly registering with the derivatives regulator. The CFTC alleges that Binance conducted transactions in Bitcoin, Ether, and Litecoin for U.S. citizens since at least 2019. This investigation by the CFTC is not the only regulatory scrutiny that Binance has faced in recent times.

Binance has also been investigated by the Internal Revenue Service and federal prosecutors over its adherence to Anti-Money Laundering rules. Additionally, the Securities and Exchange Commission conducted its own inquiry into whether Binance allowed U.S. traders to access unregistered securities.

In response to the CFTC’s allegations, Binance’s CEO, Changpeng Zhao, has denied any wrongdoing. He argues that Binance “does not trade for profit or ‘manipulate’ the market under any circumstances.” Despite the denial, the regulatory scrutiny and the recent withdrawals may lead to a tumultuous time ahead for Binance and the wider cryptocurrency market.


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Robinhood users may soon be able to withdraw crypto for the first time

Retail-trading platform Robinhood is reportedly testing a long-awaited digital wallet feature that enables users to send and receive crypto-assets such as Bitcoin (BTC).

Bloomberg reported the rumor on Sept. 21, with the publication claiming to have seen screenshots of a withdrawal interface in a beta version of the wallet feature in Robinhood’s IOS app.

While details are sparse, Bloomberg also claims to have seen a waitlist where users will be able to sign up for the new digital asset wallet. “The app also has code referring to cryptocurrency transfers,” the report added.

Robinhood users are currently only able to buy crypto with US dollars and trade digital assets on the platform, as the app does not support crypto deposits and withdrawals.

Robinhood’s crypto traders have long badgered the company to introduce deposit and withdrawal functionality for digital assets, with the calls having grown this year as fiery-eyed Dogecoin fanatics converged on the platform.

In an Aug. 19 quarterly earnings call, Robinhood CEO Vlad Tenev announced that the firm was finally exploring introducing a crypto wallet.

“I know there’s been a ton of enthusiasm from the crypto community and the Dogecoin community in particular in getting access to wallets,” Tenev stated, emphasizing the firm’s excitement to launch the new feature.

Robinhood first launched Bitcoin and Ethereum trading services in 2018 for customers in five U.S. states. Robinhood has since expanded its altcoin support and currently allows traders based in all but four U.S. states to access its crypto features.

Crypto services have become a significant part of Robinhood’s revenue in 2021, with its Q2 report showing that around 41% of its $565 million revenue was from crypto trading. By contrast, the firm generated $5 million from crypto trading for the entirety of 2020.

Earlier this month, the firm expanded its crypto offerings by launching a recurring crypto investment feature allowing users to dollar cost average (DCA) into crypto positions.

Related: PayPal reportedly looks to take on Robinhood with stock trading

Robinhood is not alone in looking to expand its support for crypto, with an increasing number of mainstream firms announcing moves to enable digital asset payments.

Cointelegraph reported on Sept. 16 that AMC Entertainment plans to accept movie ticket payments in Ether (ETH), Litecoin (LTC) and Bitcoin Cash (BCH) by 2022. The company already announced plans to support Bitcoin payments in August.

On Sept. 15 software giant Adobe also announced that merchants using its Adobe Commerce product will be able to accept cryptocurrency payments via Paypal from the fourth quarter of this year.