Crypto exchange Binance has recently frozen over $2 million in assets linked to an alleged insider trading scandal.
The biggest cryptocurrency exchange in the world by trading volume, Binance, has recently come under fire from all sides. Another report on allegedly insider trading practices that use the information with token listings and make money has surfaced since the US Commodities Futures and Trading Commission (CFTC) sued the exchange earlier this week.
Twitter user FatMan has described how an unidentified person was frontrunning Binance listing pumps of several altcoins and making enormous 7-figure profits by citing on-chain data.
Exactly how the 0x23d wallet address began purchasing FXS tokens just six days before Binance listed them on Uniswap is explained in detail by FatMan.
The crypto price rocketed after the crypto exchange listed the FXS, so the insider moved their FXS tokens to the exchange and made sizable profits. Another instance of insider trading involving Terra Virtua (TVK) tokens is mentioned by FatMan.
Although the insider’s connection to Binance is unknown, the author observes that “it is clear that this individual had foreknowledge of Binance listings several days in advance.” Binance CEO Changpen Zhao responded to this development stating:
“Thank you for pointing this to out. we had frozen $2m associated with the address in question before your thread (and they never asked to reclaim). We are also always fighting potential leaks, etc. We welcome you to point them out n the future too. Helps us all”
Binance Witnesses Outflows Of $2 Billion
The biggest cryptocurrency exchange has seen net outflows of more than $2.1 billion on the Ethereum blockchain over the past week as regulatory issues continue to mount for the exchange.
The Nansen data reveals that the exchange still has more than $63 billion in its openly accessible wallets, though. Monday, Nansen analyst Andrew Thurman told the Wall Street Journal:
“The pace of withdrawals is heightened compared to normal activity and did pick up after the CFTC announcement”.
However, the crypto exchange has previously dealt with outflows that were even greater. As Binance announced the delisting of the BUSD stablecoin in February of last year, the outflows spiked to more than $1 billion almost every day for a few days.
The exchange always has “more than enough funds to fulfill withdrawal requests,” a spokeswoman for the exchange told WSJ.
