Changpeng Zhao (CZ), CEO of Binance Holdings Ltd., tried to address fears about the state of the company’s finances in a memo to his staff. He warned his team to brace themselves for a string of challenging months. He also asserted that the company would overcome its current challenges.
In the staff memo, CZ stated that the digital asset market is in a “historic moment” and that Binance is in a “strong financial position and will withstand any crypto winter.”
“While we expect the next several months to be bumpy, we will get past this challenging period—and we’ll be stronger for having been through it.”
He went on to say that Binance had come under extra scrutiny due to FTX’s recent collapse.
The unexpected failure of FTX has shaken investor confidence and prompted several traders to take custody of their tokens, resulting in massive outflows on rival centralized exchanges. He nevertheless assured the team that the organization was built to last.
Earlier, CZ had posted a tweet describing the recent withdrawal of $1.9 billion worth of tokens from Binance as “business as usual.” Zhao stated in the tweet that the withdrawal was not unusual and had occurred previously. He also noted that there are net withdrawals on some days, and on other days, there are net deposits.
We saw some withdrawals today (net $1.14b 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.
— CZ
Binance (@cz_binance) December 13, 2022
The memo and rebuttals on Twitter follow a record-breaking net daily outflow of BTC and ETH from Binance on Tuesday.
Binance was one of the exchanges hit hard by massive outflows, with $1.9 billion in withdrawals on Tuesday.
According to Nansen data, the $1.9 billion in withdrawals of Ethereum-based tokens represents the highest daily outflow over the past 24 hours since June 13 and accounts for the majority of assets withdrawn in the last seven days.
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