Binance token BNB has been caught in the midst of regulatory crossroads with price risking $220 liquidation. Many believe if this happens, it will undoubtedly go down in history as one of the most significant liquidations in the DeFi world.
Market analysts are keeping a close eye on trends, and rumors are flying around that CEO Changpeng “CZ” Zhao and his trading firm are dumping Bitcoin [BTC] to artificially stabilize BNB.
Binance and CZ have been selling spot Bitcoin at an alarming rate, to defend the BNB $220 liquidation waterfall As spot Bitcoin is sold off, the token is purchased, which defends the $220 liquidation but also caps the upside potential of Bitcoin.
Citing a chart from one of these market observers, CZ tweeted in response that Binance had not sold either BTC or BNB and that the crypto exchange still possessed “a bag” of FTX Token FTT, the native token of the collapsed trading firm FTX, urging users not to fall for the FUD.
He also expressed surprise that these so-called analysts can easily deduce who sold based on just a price chart involving millions of traders.
Whatever it may be, the Binance-affiliated token is in a tough spot after dormant whales began to unburden its BNB bags. An ongoing crypto regulatory crackdown spotted one such whale cashing out part of its holdings after two years of inactivity.
According to data from Lookonchain, the anonymous huge HODler sold off 10,000 BNB coins for $230 each and made $2.3 million in profit. The wallet still had 15,000 BNB coins, or about $3.5 million.
1/ A whale that has been dormant for 2 years sold 10,000 $BNB ($2.3M) at $230 today.— Lookonchain (@lookonchain) June 12, 2023
This whale was a #SAFEMOON whale before and made 110K $BNB ($47.5M at that time) with only 10 $BNB($2,400 at that time) on #SAFEMOON. pic.twitter.com/jxuBJBcWad
The SEC’s classification of the token as a security and its lawsuits against Binance and rival Coinbase affected the aforementioned BNB token sale, leading to outflows and falling cryptocurrency prices.
The developing trends have ignited liquidity concerns and prompted inquiries about the exchange’s viability, as traders largely rely on strong liquidity to conduct trades.
BNB Emerges Top Gainer After 22% Drop Last Week
Despite losing nearly 10% in the last seven days, BNB, the fourth-largest cryptocurrency by market capitalization, is now leading the top 10 non-stable coin cryptos. The native token of the world’s biggest crypto exchange Binance climbed over 8% to $251.24, as per CoinMarketCap.
@GOPMajorityWhip Tom Emmer joined me in this critical fight to protect our markets: “American investors and industry deserve clear and consistent oversight, not political gamesmanship. The SEC Stabilization Act will make common-sense changes to ensure that the SEC’s priorities…— Warren Davidson 🇺🇸 (@WarrenDavidson) June 12, 2023