Binance transfers $2 billion worth of Bitcoin… suspicious or not?

Binance justifie son transfert XXL de 2 milliards $ de Bitcoin

The crypto community is feverish after the recent scandals. First of all, one would think the FTX debacle undermined the confidence of crypto investors. Also, sometimes it doesn’t take “a little” to anger the cryptosphere. This is exactly what happened today at the end of the morning. The transfer of XXL from Binance was seen, sparking all kinds of speculation. Fortunately, Binance cleaned things up less than 2 hours later. Explanations.

2 billion euros of BTC were transferred to a new wallet

At 11:01 am (French time) this morning on November 28, 2022, a unusual transaction alert the crypto community. In fact, the giant Binance made the transfer of funds quite exceptional.

Binance transferred like that 127,351 BTC. According to the price of Bitcoin at the time of the transaction, this is equivalent to more than 2 billion dollars in Bitcoin ! The funds moved from the Binance wallet to an unknown wallet that appears to have been created recently.

Not surprisingly, this transaction raised many questions within the community, starting with Watcher Guru and Whale Alert.

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Speculation is rife…

As soon as the transaction was made public, all eyes naturally turned to Binance and its famous boss Changpeng Zhao, aka CZ. However, no immediate reaction was published, which prompted the public to make their own interpretations.

Movement of funds encouraged a a general feeling of fear within the community. Indeed, the cryptosphere has been scalded by the recent fall of the FTX exchange. Shortly after the company went bankrupt, it came to light that some suspicious fund movements had been made some time before the collapse.

It is therefore understandable that some people were concerned to see Binance follow in the footsteps of FTX. So CZ suspected it was move funds for personal use.

However, other observers leaned more towards a internal movement. This was also supported by the fact that this transaction drained all the funds from the Binance cold wallet.

Binance’s response: watch out for FUD!

It took less than 2 hours to get the official response from Binance and CZ. In a tweet, Binance reassured its users the platform is currently undergoing audits involving large movements of funds.

“As part of our Proof of Reserve (PoR) process, Binance works with a third-party auditor to provide proof of ownership.

You’ll likely see a few large transfers between Binance-owned wallets throughout the day because of this.

There are SAFU funds. @binance, tweet from November 28, 2022

Admittedly, the public would certainly appreciate seeing this tweet before the famous transaction, besides after !

However, CZ came to confirm the link between the $2 billion transaction and the ongoing Proof of Reserve audit. He directly responded to Whale Alert’s tweet highlighting the transaction. Here’s an explanation:

“This is part of the reserve audit. The auditor asks us to send a specific amount to ourselves to show that we have control over the wallet. And the rest goes to a change of address, it’s a new address. In this case, the tx input is high, and so is the Change. Ignore the FUD! @cz_binance, tweet from November 28, 2022

In fact, the huge transaction clearly caused a feeling of FUD. FUD is an acronym for “Fear, Uncertainty and Doubt”, meaning ” fear, uncertainty and doubt “. Often, crypto, platform or project detractors use the FUD to undermine it by creating a panic movement.

CZ also commented on this phenomenon with a recent tweet:

“If you thought a scammer was legit, you’re probably already poor.
If you believe FUD all the time, you’ll probably be poor too.
Life is not easy. »

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