Binance sees huge bitcoin outflows, but turns out to be nothing serious

vthis morning we wrote dThe Bitcoin network was having great difficulties processing all incoming transactions – there were simply too many. Transaction costs rose sharply as a result, and Binance chose to temporarily suspend withdrawals. However, this was not fast enough to prevent significant outflows. But according to on-chain analysts, this is not true, many outflows were in fact not real outflows.

Binance Outflows Were Not Real

Binance itself stated that all capital on the platform was safe, including that of users. However, customers themselves did not seem to be so convinced of this. Data from CryptoQuant shows that about 190,000 BTC has left the platform in the past two days. According to CoinGlass 180,000 BTC even left in the last 24 hours, so roughly around the time it became known that the Bitcoin network was clogged.

But not everyone agrees. Market analyst Joe Consorti states on Twitter that the wallets were mislabeled by data providers, in his case Glassnode. This made it seem like many coins left, but in reality it was an internal reorganization. The bitcoins have simply been moved to other wallets of Binance itself.

CryptoQuant lead researcher Julio Moreno stated the same. Most of the outflows come from just two transactions of 117,000 BTC and 40,000 BTC. These would indeed be new addresses that Binance itself has created. That means the actual outflows were around 10,100 BTC before.

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A good part of that could have been caused by people noticing that the wallets were emptying. If we compare Binance with other exchanges, little seems to be going on, according to Coinglass, the outflows without Binance are nil.

Bitcoin network flooded with transactions

Meanwhile, bitcoin (BTC) does have a problem. The number of unprocessed transactions is so high that Binance has temporarily suspended on-chain transactions for customers. The hope is that infrastructure like the Lightning Network can remedy this in the future, but for now the transactions coming from Ordinals and BRC-20 seem to be flooding the network.

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