The SEC has locked horns over the entire crypto space with the recent crackdown on Paxos which is a fully regulated entity, with a license from the New York State Department of Financial Services (NYSDFS). Soon after this, huge FUD outspread within the space, and addressing the issue, the CEO of Binance, in a series of tweets clarified that BUSD is completely owed and issued by Paxos, but Binance may continue to support BUSD.
In the meantime, massive outflows were recorded in the past 24 hours of billions of dollars in cryptos. The outflows surpassed the levels recorded during the FTX bankruptcy and December 2022 FUD. As per data from Dune Analytics, nearly $1 billion in cryptos was withdrawn from Binance in just 22 hours.
An acute stress test appears to have knocked the Binance platform as they are facing constant withdrawals following an event. Along with this, Binance is getting hit from multiple sides as Circle’s regulatory complaint against the platform in terms of mismanaging the reserves back in 2022 has also surfaced. It said that Binance did not store enough crypto in reserve to support the tokens it had issued.
Collectively, Binance continues to be in dire straits as the trader’s confidence shaken’s after every such event. After the recent FTX fiasco, the market participants have been in extreme fear and tend to fall into the smallest FUD as the market bulls have not gained complete dominance yet.
Therefore, with the recent event, it appears that the crypto space continues to be in hot waters and hence the possibility of marking the bottom of the 2022 bear market continues to hold high.
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