In a recent interview, Changpeng Zhao, the CEO of Binance, one of the world’s largest cryptocurrency exchanges, addressed rumors surrounding the alleged sale of Bitcoin to boost the value of Binance Coin (BNB). Zhao categorically denied the speculations, stating that Binance’s operations are conducted with utmost transparency and integrity.
Binance CEO denies claims of selling Bitcoin after several online forums and social media platforms speculated that the exchange had been selling significant amounts of Bitcoin in order to prop up the price of BNB, its native cryptocurrency. These claims gained traction among cryptocurrency enthusiasts and investors, leading to concerns about market manipulation.
Amidst various speculations, the CEO of Binance made a firm statement denying any undisclosed trading activity involving BTC or BNB.
Accusations of Market Manipulation: Binance CEO Refutes Allegations of BTC Sales to Stabilize BNB
Changpeng Zhao, the CEO of Binance, commonly known as CZ, has denied allegations suggesting that Binance has been engaging in clandestine Bitcoin (BTC) sales, causing a decrease in BTC prices, in order to artificially stabilize the value of its BNB token.
Various market commentators, including analyst Dylan LeClair and Swan Bitcoin CEO Cory Klippsten, have raised concerns and accused Binance of intentional market manipulation aimed at artificially inflating the price of BNB.
In a tweet on June 13, CZ clarified that Binance had not sold any of its Bitcoin (BTC) or BNB holdings. He further mentioned that the crypto exchange still possessed a quantity of FTX Token (FTT), the native token of the defunct cryptocurrency exchange FTX, despite the decrease in FTT prices by $0.84.
Binance CEO Counters Allegations of Market Manipulation with Strong Response
“It’s remarkable how they claim to know the identities of sellers solely based on a price chart that involves millions of traders. Fear, uncertainty, and doubt,” he stated.
CZ’s statement was in direct response to a post by technical analysis platform Skew on June 14, where they accused Binance of market manipulation through a sequence of trades involving BTC, BNB, and Tether (USDT), with USDT experiencing a decrease in value.
He said, “Binance is definitely up to something here to prevent BNB from crashing as well as BTC.”
Accusations of Artificial Market Activity and Wash Trading Surround Binance’s BNB
Within the same discussion, Bitcoin analyst LeClair asserted that the BNB market is evidently artificial, exhibiting lower realized volume compared to BTC.
On June 13, Klippsten also took to Twitter, alleging that Binance was involved in “wash trading” and suggesting that the exchange was creating a false impression of support for BNB. Wash trading is a manipulative strategy employed in the market, involving an asset’s sale and subsequent repurchase to create artificial demand or the illusion of heightened activity.
Furthermore, Joe Consorti, an analyst at The Bitcoin Layer, characterized the price behavior of BNB as “unusual,” particularly highlighting the steadfast defense of the $220 level. He speculated that this level could potentially serve as a liquidation threshold for a loan collateralized by BNB.
Call for Transparency: Analyst Urges Binance to Provide Audited Statement on BNB-Collateralized Liabilities
In reaction to CZ’s statement, Consorti insisted that Binance should release an independently audited statement as evidence to dispel any doubts and put an end to the “FUD.” The audited statement should verify that Binance does not hold any liabilities collateralized by BNB.
On June 5, the United States Securities and Exchange Commission (SEC) filed a lawsuit against Binance US, accusing the company of violating securities regulations and participating in wash trading activities through its undisclosed primary trading firm called Sigma Chain, which is owned by CZ.
Both CZ and Binance US have vehemently denied any allegations of misconduct and expressed their firm determination to vigorously defend themselves against the charges filed in the U.S. District Court in Washington, D.C.
In conclusion, Binance CEO denies claims of selling Bitcoin surrounding the sale of Bitcoin to support BNB, emphasizing transparency and market integrity. Accusations of market manipulation, wash trading, and the recent legal action by the SEC against Binance US have brought further scrutiny to the exchange. As the cryptocurrency industry continues to evolve, maintaining transparency, adhering to regulations, and addressing concerns are crucial for building trust and ensuring the long-term growth of the crypto ecosystem.
Also Read: SEC and Binance US to negotiate a Deal.