Nansen Report: Binance’s Total Asset Holdings Remain Stable After DOJ Settlement

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Binance’s total asset holdings have remained largely unchanged following the recent settlement of civil and criminal charges between the crypto exchange and CEO Changpeng “CZ” Zhao and US authorities. 

According to a report by blockchain analytics firm Nansen, there hasn’t been a significant outflow of funds from the exchange despite the settlement.

The analysis revealed that within 24 hours of the US Department of Justice announcing a $4.3 billion settlement with Binance, there was a net outflow of approximately $956 million worth of Ethereum from the exchange. 

However, Binance’s overall holdings have actually increased, surpassing $65 billion.

Here's our latest update on @binance, 12 hours after our previous one

At the time of writing, withdrawals are continuing, and we're not seeing a mass exodus of funds

Over the past hour on Ethereum, Binance has a $17M negative netfow (more leaving the exchange than what's… pic.twitter.com/yQPtMl5ue8

— Nansen (@nansen_ai) November 22, 2023

Nansen emphasized that while withdrawals are ongoing, there hasn’t been a mass exodus of funds. 

The report compared the current situation to previous instances when Binance experienced higher outflows and negative netflows, such as in June 2023 after the SEC sued the exchange, in December 2022 following insolvency rumors, and in the aftermath of the FTX incident.

“In the past, Binance has processed higher volumes of outflow and negative netflow: Jun 2023 after the SEC sued Binance, December 2022 after insolvency rumors, and the immediate aftermath of FTX.”

The report also highlighted that Binance’s holdings of Tether’s USDT decreased by approximately $246 million in the past 24 hours. 

However, holdings of XRP and TrueUSD (TUSD) have remained relatively steady during the same period.

Binance and CZ Reach Plea Deal With US Authorities

On November 21, Binance reached a plea deal with US officials, including those from the Justice Department, Treasury Department, and Commodity Futures Trading Commission, which allows Binance to continue operating under regulatory scrutiny. 

As part of the settlement, CZ, the former CEO, stepped down, with Richard Teng, Binance’s global head of regional markets, taking over the position.

Teng, in a statement on November 22, expressed confidence in Binance’s strong fundamentals following the settlement and leadership transition. 

He also hinted at the exchange’s ability to pay the $4.3 billion it has been fined by the US Justice Department. 

As reported, Binance wallets have moved $3.9 billion worth of Tether (USDT) in a recent transaction amid the exchange’s pending $4.3 billion penalty that it agreed to pay to the Department of Justice.

On-chain data shows that the majority of the funds were transferred from one Binance cold wallet, known as Binance-Cold 2, to another wallet called Binance 3. 

Currently, the cold wallet holds a total of $6.6 billion, with $4 billion in USDT and the remainder in various stablecoins such as Decentralized USD (USDD), USDC, and TrueUSD (TUSD).

Binance has previously stated that its cold wallets are responsible for holding the majority of the company’s funds. 

However, it remains unclear whether Binance intends to utilize these funds to settle the fine imposed by the U.S. government, or if the company plans to convert the USDT into U.S. dollars or another fiat currency. 

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