Binance token breaks a losing streak spurred by worries about crypto exchanges

The native token of crypto exchange Binance Holdings Ltd. posted an ongoing slide, fueled in part by concerns about outflows from the world’s largest digital asset trading platform.

Inance Coin, or BNB, is up about 4 percent over the past two days, ending a seven-day losing streak through Saturday that was the longest since October. Bitcoin and a top 100 token meter ticked Sunday and Monday.

BNB could be seen as the arbiter of sentiment towards Binance. The platform saw $6 billion in net withdrawals over three days last week amid a general lack of confidence in crypto following the bankruptcy of rival exchange FTX and allegations of fraud against its founder Sam Bankman-Fried.

A Binance spokesperson declined to comment on BNB price action, but reiterated that by meeting recent withdrawals, the exchange has passed a stress test that should offer “extraordinary comfort” that funds are safe.

There was “a lot of FUD about Binance last week,” said Cici Lu, chief executive officer of crypto consulting firm Venn Link Partners, using an acronym for fear, uncertainty, and doubt. “The market is in shoot-first-ask-later mode, but maybe selling is overkill for now.”

According to data from CryptoQuant, there was a net inflow of 338 bitcoins to Binance on Sunday, compared to a record net outflow of more than 40,000 on Dec. 13. Ether net outflows slowed to 1,183 tokens on Sunday from net outflows of more than 278,000 last Tuesday.

Binance and some other digital asset exchanges had hired auditing firm Mazars Group to work on reports designed to show the companies had the necessary reserves to cover a spike in withdrawals.

But Mazars said last week that it is suspending work for crypto outfits because of signs the markets have not been reassured by the “proof of reserves” reports released so far. The company was also concerned about the intense media scrutiny.

Binance said the company is committed to additional transparency and is looking for a major accounting firm willing to work on such reports.

Chief Executive Officer Changpeng Zhao has defended the stock market’s position. He said in a tweet on Sunday that “we’re still hiring,” referring to a June post that said Binance was hiring for 2,000 open positions. He previously tweeted that “FUD is temporary.”

Fundstrat Global Advisors LLC’s head of digital asset strategy, Sean Farrell, said in a note on Friday that Binance is likely to be solvent and customers’ assets are fully secured.

But he also said that there is “a non-zero chance” that Binance will go down “in the event of a complete bank run.” He added that “to slightly mitigate the risk of asset loss or confiscation, all funds should be removed from the exchange.”

BNB was trading at around $247 as of 2:10 p.m. Monday in Singapore. The token has lost 9% over the past month, a period when Bitcoin has been stable. BNB is up more than 1,600% over the past three years compared to Bitcoin’s 133% gain.

https://www.independent.ie/business/world/binance-token-snaps-losing-streak-spurred-by-worries-over-crypto-exchange-42229313.html Binance token breaks a losing streak spurred by worries about crypto exchanges

Fry Electronics Team

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