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- Significant portion of ETH gets dumped from FTX.
- Binance CEO takes advantage of same.
- The CEO comments on how they have more than $8 Billion in ETH deposits on two cold wallets.
The recent transfer of $500 million in FTX Tokens (FTT) to Binance has raised serious concerns about the crypto exchange's finances.
FTX CEO Sam Bankman-Fried has promised that all operations are running smoothly, but investors have gone into a tailspin.
Apart from FTT liquidation, individuals are withdrawing significant altcoins such as Ethereum from the main FTX wallet. As per on-chain data, more than 90% of the Ethereum (ETH) has been dumped from the FTX main wallet during the Binance turmoil.
According to an on-chain data provider, “the number of Ethereum held in FTX's main wallet has decreased from 322k to 32k in just two days. The wallet was losing 500 ETH per minute at one point. Expect continued volatility as a result of the ongoing spat between FTX and Binance.”
During the 2022 crypto winter, many players froze user withdrawals. This has caused massive worry in the crypto community. As a result, any negative sentiments evoke a strong reaction, as evidenced by Ethereum withdrawals from FTX.
FTX CEO Sam Bankman-Fried has guaranteed that everything is alright. He wrote in a tweet yesterday:
“A competitor is spreading false rumours about us. FTX is excellent. Assets are acceptable. FTX has sufficient funds to cover all client holdings. We do not invest client funds (even in treasuries). We have been and will continue to handle all withdrawals.
It's well regulated, even if it slows us down. We have GAAP audits and more than $1 billion in surplus cash. We have a long history of protecting customer assets, and this is still true today.”
Binance Reaffirms Its Ethereum Holdings
As massive ETH withdrawals occur on FTX, Binance CEO took advantage of the opportunity, noting that they had over $8 billion in ETH deposits on the two cold wallets. "This isn't our money. They are considered user assets. "We're only the custodians," he added.
Not sure if CZ's statement was intended to entice FTX users. The price of FTX Token has dropped by another 20% in the last few hours due to a major selloff. At the time of writing, Ethereum (ETH) was trading 8.4% lower at a price of $1451, with a market valuation of $178 billion.
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