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Justin Sun has deposited a substantial amount of money back into Binance after the exchange’s outflow rapidly hit $1.8 billion.
TRON founder Justin Sun recently sought to calm fears concerning the financial state of affairs of popular crypto exchange Binance. On Tuesday, reports stated that Sun deposited $100 million into Binance and provided an Etherscan link to validate the transaction. Sun’s action comes after Binance’s outflow hit $1.8 billion, while its native BNB token also sank 8% during Tuesday’s Asian trading hours. Furthermore, the FUD that gripped the market also saw BSC-based decentralized finance (DeFi) protocols slip in value.
Justin Sun’s $50M Fund Withdrawal from Binance Triggered Market Fears
Part of the market’s anxiety over Binance’s health presumably came from reports that Sun withdrew a total of $50 million from the exchange. A tweet by crypto platform Wu Blockchain said:
“According to lookonchain, Justin Sun(0x9f84) withdrew 34m BUSD and 15.4m USDT from Binance 9 hours ago and transferred them to Paxos and Circle for suspected cash out. Justin Sun responded that the recent allocation of funds is just normal business cooperation.”
Shortly afterward, Binance’s withdrawals surged as spooked traders worried about its reserves. On Monday, net outflow topped $902 million within 24 hours, surpassing all other centralized exchanges in that period. The wave of withdrawals Binance endured was approximately nine times larger than the second-largest outflow.
The recent outflow is the highest for Binance since early November, two days after the collapse of FTX. However, Arkham analyst Henry Fisher does not see the withdrawal as a cause for alarm. According to him, the prominent exchange still holds around $64 billion worth of assets.
Nansen data showed that crypto exchange Huobi and blockchain tech specialist Paxos were notable recipients of Binance’s $1.8 billion outflow. The two platforms raked in a combined $162 million of netflow, with Coinbase also seeing a sharp $124 million rise in inflow.
Amid the Justin Sun-Binance development, BNB is trading down 8% on-day to $259. In addition, DeFiLlama data disclosed that Binance Service Chain (BSC) DeFi protocols are down 4.5% in total value locked (TVL).
Binance Temporarily Suspends USDC Withdrawals
Early Tuesday morning (Hong Kong time), Binance tweeted a temporary suspension of USDC withdrawals. The platform is currently engaged in a token swap between USDC and BUSD. However, Binance CEO Changpeng Zhao also tweeted that the swap required the functionality of a New York-based bank (which still needed to open at the time). In his own words:
“On USDC, we have seen an increase in withdrawals. However, the channel to swap from PAX/BUSD to USDC requires going through a bank in NY in USD. The banks are not open for another few hours. We expect the situation will be restored when the banks open.”
Zhao also addressed Sun’s deposit into Binance, describing it as part of the process for BUSD deployment onto TRON. However, the Binance chief executive officer added that he was not sure of the details since he was not personally handling the process.