Binance has had over $5.4 billion in net outflows over the past week.
👉 Background: Binance is the largest crypto exchange in the world in terms of daily trading volume. It launched in 2017 in China but has since registered the company in the Cayman Islands.
👉 What happened: Over the last few weeks, a heap of questions have been asked of crypto exchanges after the downfall of FTX. And now, it’s been revealed that Binance has had over $5.4 billion in net outflows over the past week (i.e. net customer funds that are leaving the platform).
👉 What else: And it just goes to show how much the FTX implosion has squashed consumer confidence in centralised crypto exchanges.
💡 One of the main appeals of crypto is that it's considered to be decentralised. In other words, buyers and sellers can trade with each other without an intermediary.
💡 But ironically, it’s estimated that around 99% of crypto transactions are facilitated by centralised exchanges like Binance, Coinbase or Swyftx in Australia.
💡 These centralised exchanges are similar to a stock exchange but for digital assets. So if anything happens to the exchange, like fraud, hacks or technical difficulties, your money is at risk. And given confidence is so low in centralised exchanges, many customers are running up that hill.
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