- Changpeng Zhao has denied allegations that his crypto exchange has been dumping its stash of Bitcoin (BTC) and Binance Coin (BNB).
- Heavy investors occasionally spread FUD to create an ideal situation for buying cheap coins when retail investors panic and dump.
Binance CEO Changpeng Zhao better known as CZ has been disputing claims that his crypto exchange has been dumping loads of Bitcoin (BTC) and Binance (BNB). The outspoken CEO has been adamant about the accusations brought forth by U.S. Securities Exchange Commission being inaccurate and his exchange’s plans to fight the case on its merits.
With the exchange facing months or even years in court, there have been accusations that the exchange is selling its stash of Bitcoin and Binance Coin. Furthermore, some have accused the exchange of selling Bitcoin to buy and stabilize Binance Coin.
After Binance and Coinbase were slapped with lawsuits from the SEC, there was an initial shock on the market but has since calmed and shown great resilience. According to some analysts, this resilience has been artificially generated by Binance. One analyst has highlighted what he believes is wash trading that has kept BNB at higher levels.
Wash trading like craaaaaazzzzyyyyy on Binance right now trying to pretend there’s support for BNB. This looks sooooooo bad for CZ.https://t.co/qCHjQCSXwD
— Cory Klippsten | Swan.com 🦢 #Bitcoin (@coryklippsten) June 12, 2023
The manipulative tactic involves selling an asset and then buying it shortly after to inflate its demand. Such tactics were rampant years ago when the industry was getting started.
Market analyst Joe Consorti has gone a step further to accuse Binance of selling spot BTC to prop up BNB. The analyst wrote;
Unusual price action on Binance.
Loads of selling pressure on bitcoin not present on other exchanges.
More cannon fodder that they may be selling spot BTC to prop up BNB.
The $220 level is being staunchly defended — may be a liquidation level for a BNB-collateralized loan.
Outspoken CZ who boasts of being transparent has quickly responded to the growing concerns. The CEO specifically responded to claims that BTC is being sold off for USDT and the USDT is aggressively being pumped into BNB since 27th May. CZ refuted this claim saying Binance has not sold BTC or BNB. In fact, he further revealed that the exchange is still holding a bag of the native crypto token of the derivatives trading platform FTX (FTT).
4. Binance have not sold BTC or BNB. We even still have a bag of FTT.
It is amazing they can know exactly who sold based on just a price chart involving millions of traders. FUD. 🤷♂️ pic.twitter.com/M3MUH2bFRE
— CZ 🔶 BNB (@cz_binance) June 13, 2023
CZ believes that this is purely FUD being spread for panic to lead retail investors to dump. This is a common practice in the market that allows large investors to buy out retail investors who panic sell.
Despite the controversy going around the community, both Bitcoin and Binance are steadfast. At the time of press, Bitcoin is exchanging for $25,985 while Binance is just shy of $250 according to our data.
Investors will be keen on the development of the two coins with price changes followed just as much as the case between Binance and the SEC. For most, they are preparing for a period of extreme volatility.
