The mass left after Binance founder Changpeng Zhao, also known as CZ, pleaded guilty to money laundering and resigned as CEO on November 22nd. In addition, liquidity also declined by 25% as market participants reduced their positions, according to data provider Kaiko.
Binance founder Changpeng Zhao, also known as CZ
|
In the past 24 hours, BNB – the virtual currency created by Binance – has decreased by more than 8%. According to Nansen, Binance currently holds 2.8 billion USD in the form of BNB.
Earlier, Binance agreed to pay a fine of 4.3 billion USD to the US Government, and CZ resigned as CEO. The agreement marked the end of a years-long investigation into this cryptocurrency exchange.
However, Binance remains the world’s largest cryptocurrency exchange, handling over a billion USD in transactions per year. According to Nansen, Binance currently has total assets of over 65 billion USD, meaning that the cryptocurrency exchange has enough capital to withstand a sudden wave of investor withdrawals.
“The shock of the fine and CZ pleading guilty to money laundering has not had a major impact on the cryptocurrency market,” said Grzegorz Drozdz, Market Analyst at investment firm Conotoxia. “BNB was the most significantly affected virtual currency in the past 24 hours. Among the top 100 cryptocurrencies today, 98 have shown significant recovery, while Bitcoin has only decreased by 1.3%,” he added.
According to Drozdz, the positive aspect of the cryptocurrency industry at this time is its reduced conflict with regulatory authorities, and Binance has committed to enhancing security measures.
“Information about Binance along with the possibility of the Bitcoin ETF fund being approved may have a positive long-term impact on the cryptocurrency market,” shared Drozdz.
Can Binance withstand this period?
This is a question that many investors are asking after CZ pleaded guilty to money laundering and resigned.
Established in 2017, Binance transformed from a lesser-known name to a dominant force in the cryptocurrency market within weeks.
Many experts believe that Binance is likely to survive despite the recent turmoil.
“The $4 billion fine is clearly substantial and will damage Binance’s balance sheet,” said Yesha Yadav, law professor at Milton R. Underwood and Associate Dean at Vanderbilt University. “However, it appears that this fine is not intended to asphyxiate Binance. With Binance’s leading position in the cryptocurrency market over the past few years, CZ’s personal assets and trading volume remain significant, as does the exchange’s relatively large market share. Therefore, I do not think that Binance will encounter payment issues after the fine is imposed.”
