The biggest cryptocurrency exchange by trade volume, Binance, has recently been the subject of rumours and conjecture following the FTX collapse. According to four people familiar with the situation, U.S. Department of Justice prosecutors have been looking into Binance, according to a Reuters report from December 12, 2022. A few crypto assets have appreciated in value over the past week, but Binance’s exchange token has fallen by about 6.9% against the dollar in the same time frame.
Binance’s BNB Takes a Hit from the Speculation Surrounding the World’s Largest Crypto Exchange
Following the fallout from the most recent FTX collapse, Binance is currently dealing with a lot of rumours, speculation, and FUD (fear, uncertainty, and doubt). Social media is rife with rumours about Binance’s proof-of-reserves (POR) and criticism of the company’s POR initiatives.
On Dec. 13, Changpeng Zhao, commonly known as CZ, addressed the FUD on Twitter. “FUD helps us grow, even though they are thoroughly annoying,” CZ tweeted. “You can FUD about someone without explicitly mentioning their name, which spreads awareness. It also helps unite their supporters because it forms a common defense alliance.”
CZ insisted that Binance had been the target of constant FUD since the beginning, some of which was allegedly sponsored by a major exchange. “Since then, hardly a week has passed without some FUD. We developed the capacity to disregard them and carry on with our construction, CZ said in his Twitter thread.
CZ insisted that Binance had been the target of constant FUD since the beginning, some of which was allegedly sponsored by a major exchange. “Since then, hardly a week has passed without some FUD. We developed the capacity to disregard them and carry on with our construction, CZ said in his Twitter thread.
CZ’s analysis comes in response to a Reuters article from December 12 that claims the DOJ has been looking into Binance. Four people with knowledge of the situation were quoted by Reuters as saying that DOJ prosecutors disagree about the purported investigation. According to Reuters reporter Angus Berwick, the reported disagreement between DOJ prosecutors is “delaying the conclusion of a long-running criminal investigation” into Binance.
In the meantime, the rumours and FUD surrounding Binance, the largest cryptocurrency exchange in the world, have significantly hurt BNB, the exchange token. Over the past two weeks, the value of the cryptocurrency exchange token BNB has dropped by 8.5%.
According to seven-day statistics, BNB lost more than 8% against the dollar, but since the most recent U.S. inflation data was released on Tuesday, BNB is now only down 6.9%. The trend is the opposite of what popular cryptocurrencies like BTC and ETH have done, which saw gains of between 5 and 7% on Tuesday morning (9 a.m. ET).
BNB has outperformed other crypto assets like BTC and ETH in terms of losses from the all-time highs set last year, despite the sizable losses this week. For instance, despite today’s gains, BTC is still down 74% from its all-time high (ATH) set in 2017. While Binance’s BNB has dropped by only 60.8% since the cryptocurrency asset’s $686 per unit price high printed on May 10, 2021, Ethereum (ETH) has fallen by 72% from its all-time high.