Binance, the world’s largest cryptocurrency exchange, denied speculation that it has been selling off some holdings, despite widespread social media claims amid the latest market downturn.
The crypto market experienced a significant correction after the $1.4 billion Bybit hack, which saw Bitcoin’s (BTC) price sink to a low of $78,197, last seen on Nov. 10, 2024, Cointelegraph Markets Pro data shows.
BTC/USD, 1-year chart. Source: Cointelegraph
Following the decline, social media speculation arose that some of the largest crypto firms, including Binance, had caused the market crash by selling their token holdings in over-the-counter (OTC) trades.
Source: MartyParty
Binance has refuted the claims, saying they stem from a misunderstanding of its role as an exchange. “Binance hasn’t ‘dumped’ or ‘sold’ large amounts of tokens as some tweets have wrongly claimed,” a Binance spokesperson told Cointelegraph.
“They are misunderstanding what Binance does as an exchange, which is we simply help users match trades,” they added.
Some of the speculation came after data arose of market makers withdrawing large amounts of Solana (SOL) from Binance hot wallets, leading crypto investors to falsely assume that this was the exchange selling its holdings.
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Market makers move their assets according to “own strategies”
Crypto market maker Wintermute withdrew over $38.2 million worth of Solana from Binance in the 24 hours leading up to 9:02 am UTC on Feb. 24, Arkham Intelligence data shows.
Wintermute transfers from Binance hot wallet. Source: Arkham Intelligence
The transfers occurred days ahead of Solana’s $2 billion token unlock, which is set to release over 11.2 million SOL tokens into circulation on March 1.
However, similar market makers operate based on their own strategies, unrelated to the world’s largest exchange, the Binance spokesperson explained, adding:
“We have no visibility into our users’ decisions, including market makers who move their assets according to their own strategies. So while blockchain transparency is one of the best things about crypto, it’s important not to jump to conclusions about screenshots of transactions.”
“As we always encourage our users to do their own research, we encourage the community to understand more about the role of an exchange” and “what market makers do,” added the spokesperson.
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Still, industry watchers remain concerned about selling pressure that may come with Solana’s forthcoming token unlock.
Crypto analyst Artchick.eth noted that over the next three months, more than 15 million SOL — worth about $2.5 billion — will enter circulation. Many of these tokens were purchased at $64 per SOL in FTX’s auctions by firms such as Galaxy Digital, Pantera Capital and Figure.
Similarly, crypto trader RunnerXBT mentioned that it was a “dangerous” period to buy Solana, highlighting that Galaxy Digital, Pantera and Figure stand to gain $3 billion, $1 billion and $150 million, respectively, in unrealized profits once their SOL unlocks.
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