- Binance CEO strategically withdrew USD from US banks following the collapse of Silvergate and Signature banks.
- This move seemingly prevented a potential collapse of the crypto market.
- Strategic asset shift mirrored reserves, safeguarding stability amid market turmoil.
In a recent tweet, prominent crypto researcher Aleksandar Djakovic raised intriguing insights about Binance’s financial maneuvers during a critical period, which is believed to have ‘saved’ the crypto industry.
Djakovic’s tweet suggests that Binance’s CEO Changpeng Zhao, strategically withdrew dollars from U.S. banks following the collapse of Silvergate and Signature banks. This move seemingly prevented a potential collapse of the crypto market while maintaining stability.
1/ Binance proof of reserves, the table shows how CZ was withdrawing dollars from US banks after the collapse of Silvergate and Signature banks, at the same time preventing the crypto from collapsing… pic.twitter.com/zGKNkve6y6— Aleksandar Djakovic (@sasadjak72) August 7, 2023
Djakovic pointed out that Binance was internally converting user-deposited USDC into BUSD earlier this year, yet it held onto the USDC in reserve. This distinction was evident in the discrepancy between Customer Net and Binance Net, which stood at $3.5 billion as of March 1. Notably, on March 12, the failure of Signature Bank triggered a shift in Binance’s strategy.
From March 12 to May 1, Binance reportedly began re-packaging its USDC holdings into BTC, ETH, and USDT. In this span, it acquired a substantial amount, purchasing approximately 100,000 BTC and 550,000 ETH, totaling around $3.5 billion – coincidentally mirroring the surplus of USDC they held.
Meanwhile, Djakovic’s findings are readily observable through the Proof of Reserves data. As the crypto market moved into May, a downward trend in customer holdings emerged, possibly indicating Binance’s efforts to balance its reserves. The situation appeared to stabilize with the advent of BlackRock ETF hype, halting the market decline.
Julian Hosp, CEO of Cake Group and Bake, weighed in. He suggested that the impressive performance of Bitcoin in the first half of 2023 could be attributed to Binance’s need to divest itself of USD.
Over time, the data gets clearer and clearer. The main reason #bitcoin did so well in H1 2023 was Binance having to get rid of their USD. https://t.co/XLBJyuNp4J— Dr. Julian Hosp (@julianhosp) August 8, 2023
While Djakovic’s revelations shed light on Binance’s tactical financial moves, the market remains poised for potential volatility. Analysts, including Djakovic, speculate that the forthcoming Consumer Price Index (CPI) report, driven by oil price surges, could exert downward pressure on the entire cryptocurrency market.
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