Binance Says Tether (USDT) Belongs To Clients Who Are Customers, Not To The Exchange
Binance, one of the largest cryptocurrency exchanges in the market, has moved over $782 million in Tether (USDT) tokens. Due to this reason, many individuals were wondering what was Binance doing after moving such a large amount of USDT.
This comes after USDT and Bitfinex being investigated by regulators in New York being accused of using Tether’s funds to cover $850 million in losses.
Binance Explains Why It Moved $782 Million In USDT
April 26 was a bad day for the virtual currency market. Most of the cryptocurrencies fell sharply due to the aforementioned issue with Thether and Bitfinex.
Bittrex has been rejected its BitLicense application in the New York State and regulators are also investigating why it used $700 million of USDT reserves to cover up to $850 million in losses. Bitcoin, for example, was traded close to $5,275 after reaching $5,600 a few days ago.
At the same time, several exchanges and wallets started to move USDT and other coins to different exchanges. Indeed, Binance has been one of these exchanges moving a large number of funds. The twitter user @nondualrandy showed an image in which it is possible to see this USDT transfer made by Binance.
CZ must be pooping his pants right now
— Randy Moish (@nondualrandy) April 26, 2019
The CEO and founder of this platform, Changpeng Zhao, said that these are funds that belong to clients rather than to the exchange.
He went on explaining that Binance doesn’t own the USDT that is moving, users own the funds on the Binance platform, for example, in cryptocurrency wallets. The exchange only makes sure that when people want to withdraw them, they can do it.
You misunderstand the situation. Binance doesn't own those USDT. Our users owns those $USDT on Binance platform (ie, in our wallets). We make sure when people want to withdraw USDT, they can. Our wallet balance clears shows that.
— CZ Binance (@cz_binance) April 26, 2019
Binance is one of the largest exchanges in the cryptocurrency market. At the time of writing, CoinMarketCap reported that Binance is the 6th largest cryptocurrency exchange according to its trading volume. In the last 24 hours, it handled $806 million in trading volume.
Furthermore, during the last hours, ETH withdrawals from Bitfinex increased by over 2200% after the issues that affected the platform and the Tether stablecoin. Although Tether remains under its peg with the USD 1:1, it recovered from the larger drop experienced yesterday. Each USDT can be purchased for $0.9929.