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Binance Takes Action Against Alleged Insiders: Over $2 Million Frozen

Data on the blockchain reveals how a wallet address was able to amass FXS and TVK before being listed on Binance, resulting in a considerable profit. Upon pointing out, Binance has decided to freeze those funds amounting to around $2 million dollars.

Insider Trading Acquisitions

Recently, Binance – one of the world’s largest crypto exchanges by trading volume – has been receiving criticism from all directions. This week, the US Commodities Futures and Trading Commission (CFTC) filed a legal action against the company, coupled with reports of apparent insider trading practices that seem to exploit information of token listings for financial gain. 

By leveraging on-chain data, Twitter user FatMan has illustrated how a person was able to make significant seven-figure gains through the Binance listing pumps of various altcoins.

FatMan’s research offers an in-depth look into the pre-emptive purchase of FXS tokens from the 0x23d wallet address prior to the listing on Binance and Uniswap. The listing of FXS on Binance led to a surge in its cryptocurrency value, allowing the insider to transfer their FXS tokens to the exchange, resulting in a profitable return.

Another instance of potential insider trading related to Terra Virtua (TVK) tokens has been brought to light by FatMan. Although the link between Binance and the individual in question has yet to be verified, it is clear that they had prior knowledge of upcoming Binance listings several days ahead of time.  

Changpen Zhao, CEO of Binance, expressed his gratitude to Fatman for bringing the issue to light, noting that over $2 million has already been frozen from the related address. Binance is committed to preventing any potential security breaches and encourages individuals to report any further incidents.

Binance Records $2 Billion in Outflows

Despite regulatory issues, the largest crypto exchange experienced a net outflow of $2.1 billion on the Ethereum blockchain in the last week. However, according to Nansen data, the exchange still maintains a publicly disclosed wallet balance of over $63 billion.

Binance experienced outflows of over $1 billion daily for a few days in February, due to the delisting of BUSD stablecoin. However, the exchange reassured the Wall Street Journal that they have managed greater outflows in the past, and are always prepared with adequate funds to fulfill any withdrawal requests.