Binance has witnessed a large outflow of bitcoin from its reserves following the dramatic and widely unexpected departure of founder and figurehead Changpeng ‘CZ’ Zhao this week.
According to CryptoQuant analysis, Coinbase's reserves increased by around 12,000 bitcoin while Binance's decreased by 5,000 bitcoin the day following CZ’s departure.
In dollar terms, this amounts to over $446 million in customer deposits leaving Binance and $186 million entering Coinbase at current Bitcoin prices.
Binance’s outflows have only increased since, with Nansen data suggesting the figure is honing in on $1 billion.
The real amounts are likely to be higher when factoring in Ethereum and other altcoin movements.
CZ agreed to resign from his position and plead guilty to violating anti-money laundering requirements
The charges, which include allegations of money laundering, bank fraud, and sanctions violations, are part of a negotiated settlement allowing Binance to continue operations while addressing the criminal allegations.
This has left a question mark over Binance's prospects, but Make no mistake- Binance is by far the largest crypto exchange in town.
Per the latest CoinMarketCap data, Binance’s trading volumes over the past 24 hours were close to $10 billion (£8 billion), compared to around $1.9 billion at Binance’s nearest competitor, Nasdaq-listed Coinbase Global Inc (NASDAQ:COIN).
Binance and Coinbase are vastly different beasts, with the former a favourite among retail investors and the latter tailored to institutional investors.
This has kept Coinbase in second place for a long time, but it might not always be this way.
“Coinbase is the leading US exchange today in terms of regulation and lobbying, and its volume is largely made up of institutional players,” stated CryptoQuant, before adding: “Understanding what the institutional players are doing is essential because the flow that is entering and is about to enter this market comes from these entities.”