• The SEC recently sued Binance and Coinbase, causing users to withdraw billions of dollars across multiple chains.
• A recent analysis by blockchain data and research company Nansen.ai shows that Binance experienced a net outflow of $491.9 million, while Coinbase experienced a net outflow of $105.3 million.
• The top three wallets in terms of net withdrawals belong to leading institutional investors Cumberland and Brevan Howard Digital, demonstrating concerns regarding regulatory scrutiny.
SEC Lawsuits Trigger Massive Withdrawals
The Securities and Exchange Commission (SEC) has issued lawsuits against both Binance and Coinbase, triggering massive withdrawals from these exchanges by users across multiple chains. Blockchain data and research company Nansen.ai conducted an analysis into the aftermath of the SEC’s action and shared their findings on Twitter.
Binance Experiences Significant Net Outflows
In the 24 hours since the lawsuit was announced, Binance experienced over $3 billion in withdrawals with a negative net flow of $1.43 billion as of 3 pm UTC on June 6th – indicating more assets were withdrawn than what was deposited into the exchange. This figure is less dramatic than when the SEC first sued Binance; however, it still represents a significant shift in user behavior. Despite this, Binance holds over $54 billion across known wallets with Ethereum representing less than 10%, showing resilience from the platform despite heavy withdrawals from users..
Institutional Investor Withdrawals Reveal Regulatory Concerns
The top three wallets in terms of net withdrawals belonged to leading institutional investors Cumberland and Brevan Howard Digital which could indicate concerns among institutions regarding potential regulatory scrutiny by the SEC following their lawsuits against both exchanges..
How Will Exchanges Adapt Moving Forward?
Despite these substantial withdrawals from both exchanges due to the lawsuits filed by the SEC, it remains unclear how they will adapt moving forward considering new regulations coming down from authorities such as AML/KYC compliance for customers making deposits or withdrawing funds..
Conclusion
It’s clear that regulatory actions taken by authorities can have large implications for crypto exchanges like Binance and Coinbase who must now make sure they are compliant with laws or face further legal action down the line if they are found not to be compliant with regulations set forth by agencies such as the SEC