Did Binance just dump over $5 billion in crypto?

But for all its success, Binance has been mired in controversy since its beginning. From dubious ties to China, to more recently CZ doing a stint in jail on money laundering charges it’s been a wild ride for CZ and for Binance.

Author

Adam Atlantic
February 12, 2025 • Estimated Reading Time: 6 minutes

Changpeng Zhao (CZ, as he’s usually known by) is the founder and former CEO of Binance.

Binance in the last several years has become the world’s largest cryptocurrency exchange. It does on average around $20 billion per day in volume. But on extra volatile days, it’s known to see closer to $100 billion in daily volume.

It’s not a bad effort for an exchange that’s only eight years old.

It also has its own blockchain and cryptocurrency, BNB (formerly Binance, then Binance Chain, now just BNB). The BNB token, which is inextricably linked to Binance, has a current market cap of around $92 billion and a token price of $632.

When it started in 2017 it’s market cap was $10 million and the token price traded as low as four cents!

But for all its success, Binance has been mired in controversy since its beginning. From dubious ties to China, to more recently CZ doing a stint in jail on money laundering charges it’s been a wild ride for CZ and for Binance.

But what just happened in the last 24 hours has shaky similarities to the collapse of the FTX exchange in 2022 and may signal the next big capitulation in the crypto markets.

The rumours say one thing, customer services say SAFU

First a quick history lesson…

In 2021 Binance sold down their $2.1 billion equity ownership of the FTX exchange run by Sam Bankman-Fried. By November 2021, Binance had begun to completely liquidate their FTT token holdings (the token inextricably linked to the FTX exchange).

CZ passed off these liquidations as part of a financially sensible strategy[1] and risk management.[2]

This had come off the back of reports that Alameda Research (also owned by Bankman-Fried and tightly linked to FTX) was trading insolvent, and a collapse of FTX might be on the cards. At its peak FTX had been worth nearly $50 billion.

The rumours were CZ was jumping ship in a big way. Plenty leapt to the defence of FTX, but others like Ran Neuner flat out said, “Get your funds out of FTX. This is financial advice[3] .”

Neuner was right. CZ had also timed his exit perfectly. And FTX collapsed in what is considered to be the tipping point that sent the crypto market into its deepest “winter” yet.

So, what is it about the FTX saga that has my crypto-senses tingling this time around?

Cointelegraph posted this earlier today:

Source: Cointelegraph via X.com[4] 

According to a post on Binance’s own news page, “The move appears to be a strategic asset conversion rather than a liquidity crisis[5] .”

I love the use of the word “appears” in that sentence.

Worth noting that Binance only trimmed 16% of BNB and still holds around $3.1 billion of its own crypto.

This also comes just a couple of months after CZ was released from prison (note: he’s no longer CEO or appears to have control of the company). But it also comes as the US Securities and Exchange Commission (SEC) paused an existing legal case against Binance for 60 days.

As this is all transpiring, BNB the token is ripping higher in price while the rest of the market is a sea of red.

Of course Binance Customer Support jumped to the forefront of all this saying:[6]

Source: Binance Customer Support via X.com

But then again, that’s exactly what FTX said before they capitulated.

An important safety reminder

I’m not here to say that Binance is FTX 2.0 – if it was it would a magnitude worse for the wider market. Frankly, it doesn’t matter what happens to Binance, good or bad, the crypto market was alive before, and if it died, would be around after.

What this is all a stark reminder of is to not keep your assets on any exchange long term.

Sure Binance is big, but can you say you trust it unconditionally?

I can’t. I never would. And I would say the same thing for other exchanges like Coinbase, Kraken, OKEx or any other third party exchange.

You never really know how these things are run (as FTX clearly showed everyone). And you never have the same kinds of protections you typically get with traditional finance.

My view is that it’s always wise to store your crypto in a wallet, or hardware device that you and only you control.

That way, when crypto companies collapse like Mt.Gox (2014), Cryptsy (2016), Cryptopia (2019), BlockFi (2022) or FTX (2023) you’ll be just fine because you’ll have full control over your assets.

There’s a saying in crypto, “not your keys, not your crypto”. And it always rings true. If you aren’t in full control over your crypto assets, are they really even yours?

Be wary and cautious out there.

Trust in crypto (not exchanges),

Adam Atlantic