Nansen data: $1 billion in crypto exited from Binance

Following news that came out yesterday, Nansen data reveals that there have been outflows exceeding $1 billion from Binance in various crypto assets, excluding Bitcoin. 

Taking only ETH into consideration, there have been net outflows of $956 million in the last 24 hours, including $17 million in the last hour alone. 

The reduction of crypto funds on Binance according to Nansen’s data

Looking at the dollar value of total funds held, the past 24 hours have also seen reductions of as much as $246 million in USDT, $76 million in BTC, and $39 million in USDC. 

Some changes, however, were positive, such as BNB increased by $97 million, SOL increased by $34 million, and LINK increased by $27 million, perhaps because some holders are depositing to sell. 

However, Nansen points out that there have been even higher volumes of daily outflows in the past, such as in June when news of the SEC complaint broke, or in December 2022 after the FTX bankruptcy. 

So these are significant outflows, but not records. 

According to data from CoinMarketCap, which is owned by Binance, as of today the exchange would be found to hold a total of just under $73.5 billion in funds, made up of 26.4% BTC, 26% USDT, 11.5% BNB, 9% ETH, 4% TUSD and the remaining 23% other cryptocurrencies and tokens. 

Nansen notes that in light of this data, the outflows recorded in the last 24 hours are actually very small, partly because there would still be over $65 billion of assets present on-chain on the platform. 

Nansen’s data therefore differ from those of CoinMarketCap. 

The next few days according to Nansen data: what will happen to the crypto exchange Binance?

According to Nansen analysts, a true mass exodus of funds from Binance is not expected.

Therefore, this would be a volume of outflows that is not particularly abnormal, although higher than the norm. 

Moreover, although BNB has suffered a 10% price drop, at the moment its performance appears to be flat (Binance has $2.8 billion in BNB currently). 

In other words, it is possible that the declines due to the release of yesterday’s news have stopped. 

The fact, however, that yesterday’s decline now seems to have stopped does not necessarily mean either that the situation will remain stable over the next few days or that there will be a rebound. 

Simply the storm that was triggered yesterday has died down, and in the absence of any new storms the situation may in fact remain stable. 

The future of Binance

With the agreement with US authorities, the final exit from the US market, and the appointment of new CEO Richard Teng, Binance’s future looks uncertain but not necessarily bleak. 

Indeed, yesterday’s substantially small outflows suggest that not many are betting on the exchange imploding. 

Note that both Binance and CZ were very insistent yesterday that none of the U.S. government authorities investigating their account had found any problems with, for example, the custody of customer funds. 

It is therefore a completely different situation from, for example, FTX, such that Binance can continue to operate as an exchange as if nothing happened outside the US. 

There are also no problems or particular slowdowns in withdrawals by users, so operations seem to have been maintained at 100%. 

By losing the US market altogether, Binance will also lose some of its market share, but it could maintain its global leadership in this regard. 

Suffice it to say that by trading volumes on spot markets, out of a total of about $73 billion yesterday as much as $14.7 occurred on Binance. In second place among crypto exchanges by spot volumes yesterday was Bybit with just over 3.2 billion, or less than four times as much. 

Binance remains the world’s leading crypto exchange to date, notwithstanding. 

The future of crypto markets

Things may change, however, when giants such as BlackRock come to this market, particularly in the US. 

While to date the U.S. market is dominated by Coinbase, after the exit of first FTX and then Binance (albeit for different reasons), with the approval of ETFs on Bitcoin and Ethereum spot the situation could change. 

Suffice it to say that the trading volume of derivative products on cryptocurrencies is already significantly higher than that of spot markets. 

For example, Binance itself against $14.7 billion in spot volumes yesterday recorded $44.3 billion in trading volume of crypto derivatives. 

Taking the average daily trading volumes of ETFs as an example, it turns out that in the US alone they are about 140 billion, which is in line with the trading volumes of crypto derivatives globally. 

Therefore, the US ETF market alone is able to compete with the internal global crypto derivatives market, and this is excluding the traditional futures and options market. 

With the entry of giants like BlackRock, it is possible that the crypto market in the US will be engulfed by traditional markets, where crypto exchanges will have very little power. 

So while the health of Binance does not seem to be a concern, we may instead be facing a crossroads that could lead crypto markets to a new evolution in which exchanges will count for less and less.