U.S. Securities and Exchange Commission (SEC) Commissioner Mark Uyeda advocates for the withdrawal of Staff Accounting Bulletin 121 (SAB 121), which sets guidelines for accounting crypto liabilities. He argues that the method of its issuance undermines the foundational checks and balances designed to prevent excessive administrative control. Despite bipartisan support for a resolution to repeal […]
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Record Withdrawal From US Bitcoin ETFs Marks Largest Single-Day Outflow
On May 1, 2024, U.S. spot bitcoin ETFs experienced their most significant single-day outflows since their inception on Jan. 11, 2024. ETF Institute Co-Founder: ‘Inflows Don’t Go up in a Straight Line’ Data sourced from coinglass.com reveals that these funds saw a withdrawal of 3.7 million on Wednesday, with Fidelity’s FBTC experiencing the highest outflow, […]
Bitcoin News
Kucoin’s Legal Woes Spark Massive $1.7 Billion Withdrawal, Onchain Data Reveals
After the Kucoin indictment on Tuesday, subsequent onchain data from Nansen indicates that, to date, .7 billion in funds have been withdrawn from the exchange. Crypto Assets Worth .7 Billion Pulled From Kucoin Since the Department of Justice (DOJ) accused Kucoin and its founders of breaching the Bank Secrecy Act and anti-money laundering regulations, there […]
Bitcoin News
Binance Announces Lightning Network Withdrawal Implementation Amidst Bitcoin Network Congestion Issues
Binance has announced its intention of implementing Lightning Network, a layer 2 Bitcoin scaling protocol, on its platform after experiencing an episode of congestion regarding withdrawals on the Bitcoin network. The exchange had to pause bitcoin withdrawals twice due to a large backlog of operations stuck as a consequence of high transaction fees.
Binance Announces It Is Working on Implementing Lightning Network Withdrawals
Leading cryptocurrency exchange Binance has recently announced it is working to integrate Lightning Network, a bitcoin-based scaling solution, into its platform. The exchange made the announcement after having to pause bitcoin withdrawals twice in a single day due to network congestion.
The congestion issue Binance referred to had to do with the rise of BRC-20 tokens, which are issued on top of the Bitcoin blockchain, and have overwhelmed the BTC mempool, having more than 450,000 transactions pending with fees of dollars at the time of writing, according to blockchain data.
The implementation of Lightning Network withdrawals would allow users to have the option of sidestepping the high fees collected by the BTC network when experiencing this kind of congestion. Binance announced that, besides starting to work on this implementation, it would adjust its withdrawal fees to avoid facing this issue in the future and that it would continue to monitor the situation, adjusting fees accordingly.
Also, Binance stated:
This is a learning opportunity for us and we’ll do our best to prevent this from happening again.
Addressing BTC Outflow Rumors
On May 7, the exchange paused BTC withdrawals for the first time, stating that it was “experiencing a congestion issue,” and that the Binance team was “currently working on a fix until the network is stabilized” vowing to reopen withdrawals as soon as possible.
Shortly after, bitcoin withdrawals were reopened only to be suspended once again due to “the large volume of pending transactions” the exchange had. This situation prompted the diffusion of messages regarding large outflows coming from the directions associated with Binance. Changpeng ‘CZ’ Zhao, CEO of Binance, dismissed these reports as FUD on social media.
Binance clarified that the outflows were “actually movements between Binance hot and cold wallets due to the BTC address adjustments” and that the reports were mistakenly identifying the wallets of the exchange as belonging to others.
What do you think about Binance’s announcement of the implementation of the Lightning Network for withdrawals? Tell us in the comments section below.
Ethereum’s Shapella Upgrade Unlocks Staked Ether, Over 860K ETH Poised for Withdrawal, Price Surges 6%
On Wednesday, April 12, 2023, at 6:30 p.m. Eastern Time, Ethereum’s Shapella upgrade was successfully implemented, enabling validators to withdraw staked ether. Data reveals that more than 860,000 ether is poised for unlocking, and 77,000 ether is expected to be withdrawn on Thursday. Ether’s price has experienced a surge, rising 6% against the U.S. dollar within the past 24 hours.
Staked Ether Can Now be Withdrawn Following the Network’s Shapella Upgrade
Ethereum underwent a substantial update on April 12 when the Shapella hard fork launched, allowing validators to access their staked coins. This marks Ethereum’s first major development since The Merge—the transition from proof-of-work (PoW) to proof-of-stake (PoS). The hard fork officially took effect at epoch 194,048 or 6:30 p.m. (ET) on Wednesday.
Since the upgrade, numerous validators have prepared to withdraw their staked ether. However, ether withdrawal restrictions include a daily limit and a waiting list for validators. Withdrawals are available in two forms: those for reward withdrawals and those for the required 32-ether validator withdrawals.
As of 9:30 a.m. (ET) on Thursday, April 13, 2023, over 860,000 ether—valued at .71 billion using current exchange rates—are awaiting withdrawal. A staggering 17.46 million ether worth more than billion is currently locked for staking purposes. The annual percentage rate (APR) for staking ether stands at 5.06%.
Despite the upgrade, Ethereum network transaction fees have remained relatively stable. The average transaction fee on Thursday is approximately 0.0029 ETH or .72 per transfer, while the median fee hovers around 0.0013 ETH or .66 per transfer. On Thursday, ethereum (ETH) climbed above k per unit, reflecting a 6% increase over the past 24 hours. Additionally, ETH dominance has risen to encompass 19.3% of the entire crypto-economy with a market cap surpassing 1 billion.
What do you think the successful implementation of the Shapella hard fork means for Ethereum’s future and the wider cryptocurrency market? Share your thoughts and predictions in the comments section below.
Binance Sees Largest Bitcoin Withdrawal In Its History, BTC Rally Set To Benefit?
The largest crypto exchange in the world, Binance has experienced the most significant Bitcoin withdrawal in its history, per recent data. The company might face a bank run as crypto investors’ confidence continues to decline following the collapse of trading venue FTX and a U.S. investigation into major crypto exchanges.
At the same time, positive economic data from the U.S. is positively impacting the market. Bitcoin is back above its previous yearly lows. As of this writing, BTC’s price trades at ,750 with a 4% and 5% profit in the last 24 hours and the previous week, respectively.
Bitcoin Rally In Danger, Binance Makes A Stand
Data from on-chain analytic firm Glassnode, shared by Dylan LeClair, indicates that Binance has seen a massive withdrawal of 40,000 BTC in the last 24 hours. The outflows are almost double those seen in July 2021.
At that time, the crypto market was experiencing a second capitulation event after hitting an all-time high north of ,000. The cryptocurrency lost over 50% of its value from May to late July.
In early November, the crypto exchange saw a significant outflow as FTX went belly up. However, the market seems more bearish on crypto exchanges now that at two of its worst sentiments, during the 2021 capitulation and the FTX collapse.
In addition, the crypto exchange has experienced its worst stablecoin outflow since its inception. Additional data from LeClair indicates that Binance has seen .1 billion in outflows in the last 24 hours. There are billion in stablecoin reserves.
Overall, the exchange has enough funds to cover ten times its withdrawals, but the market sentiment is negative, and crypto investors’ confidence continues to dip. Changpeng “CZ” Zhao, CEO of Binance, welcomed the withdrawals and classified them as “stress testing”:
We saw some withdrawals today (net .14b ish). We have seen this before. Some days we have net withdrawals; some days, we have net deposits. Business as usual for us. I actually think it is a good idea to “stress test withdrawals” on each CEX on a rotating basis.
Bitcoin exchange outflows are often a bullish indicator. In the current context, with inflation declining and a potential U.S. Federal Reserve (Fed) pivot, the perception around outflows changed.
However, there is less Bitcoin on exchanges, regardless of market sentiment. The less the BTC supply on these venues, the more support for a market rally.
Did Celsius’ Withdrawal Trigger The Terra/ LUNA Collapse? Claim & Response
Did Celsius set off the domino effect? Almost a month ago, The Block Crypto reported that Celsius pulled at least 0M from the Anchor protocol before the collapse. Two weeks ago, blockchain analytics firm Nansen identified Celsius among the seven big wallets that allegedly triggered the bank run on Anchor. Recently, Celsius responded.
Is this the explanation for the Terra/ LUNA collapse? Was this whole situation not a deliberate attack? Were natural market forces responsible instead? The estimation is that 75% of all UST in existence was locked in the Anchor Protocol, a service that offered a suspiciously high 19.5% yield. That number was one of the main drivers behind UST and LUNA’s success. It’s only logical that the bleeding started there.
According to this theory, how did all of this happen? Let’s explore the facts and explanations provided by all parties involved.
Nansen Identifies Celsius
When the Terra/ LUNA crash happened, a deliberate attack on a perceived vulnerability was the first and main theory. According to Nansen’s “On-Chain Forensics: Demystifying TerraUSD De-peg” report, “This on-chain study refutes the narrative of one “attacker” or “hacker” working to destabilize UST.” How did it happen, then? Well, the natural market forces unraveled the poorly designed algorithmic stablecoin. Back to Nansen:
“Our analysis leveraged on-chain data to demystify what happened before and during the UST de-peg. Through the examination of on-chain activities, we found that a small number of wallets and a likely even smaller number of entities behind these wallets led to imbalances in the Curve liquidity protocols that were regulating the parity between UST and other stablecoins.”
One of those wallets belonged to Celsius. Did they know a collapse was incoming? Or did they just react first to a dangerous situation?
UST price chart on Coinbase | Source: UST/USD on TradingView.com
Celsius ’ Explanation Puts Things In Perspective
The Terra/ LUNA collapse began on May 9th. Two days later, Celsius tweeted this cryptic message: “As part of our responsibility to serve our community, Celsius Network implemented and abides by robust risk management frameworks to ensure the safety and security of assets on our platform. All user funds are safe. We continue to be open for business as usual.”
As part of our responsibility to serve our community, @CelsiusNetwork implemented and abides by robust risk management frameworks to ensure the safety and security of assets on our platform.
All user funds are safe. We continue to be open for business as usual.
— Celsius (@CelsiusNetwork) May 11, 2022
What did Celsius mean? The circumstances forced them to explain themselves. In the article “Search Continues for Source of TerraUSD Crypto Bank Run,” the Wall Street Journal paraphrases them:
“Celsius said that its risk-management group recognized “shifts in the stability” of the platform that prompted it to remove its assets only for the sake of protecting its customers’ money. The company didn’t profit from the instability, it said.”
It also confirms that one of Celsius ‘ business models was to simply accept deposits from their customers, lock the funds in Anchor at a 19.5% yield, offer their clients a 14% yield, and pocket the difference. However, “it wasn’t clear to investors that their money in a Celsius account might have been invested in the Anchor platform. Celsius, Voyager and others in the industry don’t usually disclose their counterparties.”
Where Does The Money Come From?
The Wall Street Journal article went deeper than the Terra/ LUNA collapse. It pointed a magnifying glass at DeFi in general.
“In DeFi, it isn’t easy to understand who provides money for loans, where the money flows or how easy it is to trigger currency meltdowns. This is one reason regulators are concerned about the impact of DeFi on investors and the broader financial system.”
As an example of that, check out The Block Crypto’s explanation of how Celsius staked its money in the Anchor Platform. Apparently, doing all of this instead of buying UST directly is what saved the company:
“The process of depositing funds to Anchor Protocol was convoluted. Igamberdiev explained that it involved first staking ETH using Lido to receive Staked ETH (stETH); then sending stETH to Anchor vault on Ethereum in order to mint and send bETH (a token representation of stETH) to Wormhole, a crypto bridge; minting bETH on Terra using Wormhole; before finally depositing bETH to Anchor Protocol.”
We gave Celsius the right to reply. It’s only fair that we end this with Cory Klippsten’s criticism of the service, Swan Bitcoin’s CEO said:
“It’s being marketed as a better savings account and it’s not. What you really are doing is, you’re an unsecured lender. They’re gathering retail loans and investing it out the back end in lightly regulated activities.”
Do what you will with all of the information in this article. Plus, do your own research.
Featured Image de Bradyn Trollip en Unsplash | Charts by TradingView
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OKEx CEO Jay Hao Talks About Recent Withdrawal Suspension and Safety of Crypto Assets on the Platform
The leading crypto spot and derivatives exchange OKEx recently announced that crypto withdrawal service will be restored on the platform by November 27, after more than a month of suspension. The news has come as a relief to its users.
We reached out to the CEO of OKEx, Jay Hao, and asked a few questions about the recent events and their effect on OKEx and its customers.
Q: It has been an anxious month for many OKEx users. Can you tell us more about the challenges they faced during the withdrawal suspension period?
A: This has been a challenging time for all of us but especially for our users. Whilst they have never had to worry about the safety of their assets as we have repeatedly reassured them that all funds are safe, they have had to deal with uncertainty as we were unable to give them an exact date when withdrawals would be open. Uncertainty can cause inconvenience and stress and we can only apologize for this. We are so very thankful to our users for their continued support and will grow stronger and better together with them.
Q: How did it impact OKEx’s operations?
A: All other operations on the OKEx exchange remained unaffected. We continued to maintain a business as normal approach throughout the suspension period while working on enhancing OKEx’s risk management system to safeguard user assets, supporting the Bitcoin Cash hard fork, listing the new asset BCHA, and airdropping tokens into Bitcoin Cash holders wallets.
We have seen an understandable decrease in trading activity on the exchange. However, we have also received much support and encouragement from our users not only through messages but also when we look at the data from leading platforms such as skew. Despite the withdrawal pause, OKEx held strong among the top bitcoin futures exchanges and is still leading the pack as the number-one derivatives exchange in terms of OI on Bitcoin futures.
We have also continued to forge ahead with new projects to list and in talks with new companies to partner with to build out the OKB ecosystem further and enhance the user experience on our platform. We know that many customers have had their trust in us affected and we sincerely apologize for this. Our work from here on is clear: we will uphold our commitment to winning back user trust and ensuring that OKEx remains their platform of choice for investing and trading digital assets.
Q: What was the reasoning behind the withdrawal suspension? Is the company taking any steps to ensure such an event doesn’t repeat in the future?
A: The reason for the suspension of withdrawals was because one of our private key holders was temporarily unable to authorize transactions. We have a very robust backup mechanism in place for private key holders that makes sure the activation of the backup private key can still be triggered in the event of long-term incapacitation, such as death or memory loss. However, we failed to include other important scenarios, such as private key holders becoming unreachable due to unforeseen circumstances, in our contingency plan.
Clearly, we cannot have a situation where this occurs again and we are now making it our full priority to upgrade and improve our internal processes. It has been a very challenging period but we have learned some very valuable lessons. Most importantly, all user assets have been kept safe this entire period, which has always been our number-one priority at OKEx.
Q: What are your thoughts on this incident, and how do you think OKEx should proceed from here to boost the crypto trading community’s confidence in the platform.
A: I think that the incident highlighted several very important points. It exposed some weaknesses in our internal processes which we are now steadfast in correcting. But it also highlighted the strength of our infrastructure and security in that we were able to safeguard all user assets as well as continue to maintain operations on all other functions of the exchange.
Outside of OKEx, the incident highlighted the cryptocurrency market’s maturity reflected in the price of Bitcoin and other major assets and their resilience to the news. We also found out how supportive and loyal OKEx customers are and how high confidence has remained in our platform. Not only will we be thanking them with generous rewards programs upon resuming withdrawals but we also hope to restore any loss of trust throughout this time.
We will also be continuing to enhance the user experience, roll out new products and features, and listen to customer feedback. Apart from being CEO of OKEx, I have another very important job at the exchange which is Chief Customer Service Officer. I regularly speak to customers one-on-one to identify their pain points, listen to their suggestions, and accelerate their ideas and needs through our product development process.
In order to ensure customers feel that all their concerns are addressed, I will be hosting a live AMA in our Telegram group ahead of the withdrawals this week, in which they can ask me any questions they like about the incident, user security, the resuming of withdrawals, and the rewards programs we are offering – or about anything else for that matter!
Q: Crypto exchanges and trading platforms suspending withdrawals time-to-time has become a common occurrence. In a few cases, these platforms have shut down causing losses to investors. This precedent has caused many to worry when an exchange or a trading platform prevents users from withdrawing their funds at any time. How does OKEx ensure the security of crypto assets to ensure the protection of the interests of investors? Also, please give our readers an insight into the safety and security features safeguarding crypto assets on the platform.
Prior to withdrawals reopening, our team is conducting additional security checks so that we can ensure the safety of resuming normal operations of our hot wallet system. We have garnered years of experience in safely operating digital wallets, assets, and transactions with no major security incidents and this has always been our number-one priority at OKEx.
We invest significant resources in offering some of the most robust security in the industry through a combination of cold and hot wallet storage, and a state-of-the-art risk management system that uses various online and semi-offline protocols to flag up suspicious activity and prevent any large malicious withdrawals. You can find more details about the specifics of our hot wallet system here.
In addition to that, OKEx has always insisted on maintaining 100% reserves ever since its inception. This means that all withdrawals are guaranteed and 100% of user funds can be withdrawn without any restrictions after withdrawals are reopened.
Q: By opening withdrawals after a long time, OKEx may encounter a huge surge in withdrawal requests. Is the platform prepared to handle them?
A: We are fully prepared for any surges in withdrawals as I mentioned earlier. We maintain 100% of reserves and users can withdraw their funds without restrictions. From the continued support we have seen, consistent trading activity, and by maintaining a complete service across the rest of the platform, we believe that confidence remains high in OKEx. We are also making sure that we compensate our loyal users with our newly rolled out reward campaign. However, if we do experience significant withdrawals, we will work hard to restore trust to ensure that OKEx becomes traders’ platform of choice once again.
Q: Would you like to share anything more with our readers?
The reward campaign and initiatives that we are offering as withdrawals reopen are significant and we hope that our users will take advantage of them and accept them as our way of thanks and apology over the incident. We also have many exciting initiatives in the pipeline that will ensure that OKEx maintains its place as a market leader. For more details of the reward campaign, please refer to the announcement here.
Image by Freie Menschen Freie Arbeit from Pixabay
OKEx to Restore Crypto Withdrawal Service on Its Platform by Nov 27
Users of leading cryptocurrency spot and derivatives exchange, OKEx can now rejoice as the platform has announced the resumption of cryptocurrency withdrawals by Nov 27. The latest announcement means that users will be able to withdraw their crypto assets after the platform temporarily suspended the service on Oct 16.
The suspension on withdrawal was set in place as a measure to safeguard users’ funds following the involvement of one of its private key holders in the public security bureau investigations. During the entire period, all other features except for withdrawals have been working flawlessly.
Acknowledging the inconvenience caused to its community, CEO of OKEX Jay Hao said, “We are extremely pleased to be able to announce the return of a full service for our users and would like to thank them for their continuous support during this difficult time. We apologize for the inconvenience caused and know that we must continue support during this difficult time. We apologize for the inconvenience caused and know that we must continue to work diligently to restore their confidence.”
OKEx has always been maintaining 100% reserves, a practice it will continue to follow so that users can withdraw all their funds at any time if they wish. Now, with services on the verge of being completely restored, OKEx is also in the process of launching user loyalty reward campaigns as a symbol of goodwill for the benefit of its customers.
“Offering loyalty rewards is one small way that we can give back to OKEx users but we assure them that we will continue to uphold our commitment to excellence, innovation, diversity of service, and the safety of user assets, which has always been our first and foremost priority,” added Mr. Hao.
Meanwhile, the company will continue to develop and launch innovative products and add support for new tokens to meet the various needs of the vast trading community.
Read the official release here.
Image by Peggy und Marco Lachmann-Anke from Pixabay
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