Binance liquidates $8 billion in BTC, ETH, and USDT reserve assets? Is it to realize profits or is it pessimistic about the future market?

According to the Proof-of-Reserves of the cryptocurrency exchange Binance, the exchange may have sold, invested or reallocated up to $8 billion worth of Bit, ETH and USDT from its reserve assets last month, which has raised market concerns about such a large amount of changes.

(CZ: Perhaps banks should use Merkle Tree for Proof-of-Reserves? dForce founder: They already have FED as a guarantor)

Binance's extra reserve assets have shrunk significantly

According to Coindesk, in Binance's Proof-of-Reserves in December 2024, the exchange listed about $14 billion in reserve assets, some of which were excess reserves. However, as of February 1 this year, these extra reserves have been significantly reduced.

Binance's new Proof of Reserves Data is wild.

Binance sold ALOT of it's Corporate Assets in January:
– Binance sold almost all its 4 Bil. $ in BTC
– Binance sold almost all its 3 Bil. $ in USDT
– Binance sold all of its 700m $ in ETH
– Totally sold 8 Bil. of its 14 Bil. $ Assets pic.twitter.com/KiJAS0Qlxn

— Symbio (@NoCryptFish) February 10, 2025

According to Binance's monthly asset reserve report, the company's non-user net assets include 2,746 Bit, 275 million USDT, 174 ETH, and 4.86 million BNB.

However, compared to the snapshot in December last year, these numbers have declined significantly. At that time, Binance's non-user assets were 46,896 Bit, 2.989 billion USDT, 216,312 ETH, and 5.83 million BNB. Converted to US dollar value, the asset has shrunk by more than $8 billion.

Market observer AB Kuai Dong also pointed out that most tokens have been reduced, with some converted to the stablecoin USDC, and the reduction in BNB is the lowest at only 16%.

The direction of funds is unclear, and the market is speculating

So far, there is no clear data explaining the destination of these funds. The community speculates that some of the funds may have been used to pay fines imposed by regulatory agencies led by the US Securities and Exchange Commission (SEC), or may be related to the FTX bankruptcy liquidation and fund recovery (clawback).

(SEC's last gambit? Revised lawsuit alleges Binance and CZ illegally operated securities trading)

Dong also attached an explanation from F2pool co-founder Shenyu, who believes it may just be a case of profit withdrawal at the beginning of the year, which has happened before in June 2023 and February 2024 when Binance faced regulatory fines.

The hottest topic in the industry today should be Binance, which has significantly reduced its own BTC, ETH and other assets held on the platform. It's important to note that these assets are mainly the platform's past earnings, not user funds.

Currently, most cryptocurrencies have been reallocated to the stablecoin USDC, with BNB having the lowest reduction at -16.6%. If we look at the market performance in January, most coins are at historical highs. pic.twitter.com/1N4E5gBf3f

— AB Kuai.Dong (@_FORAB) February 11, 2025

So far, Binance founder CZ and current CEO Richard Teng have not responded to this.

Reducing assets is not user funds

It's worth noting that although the reserve assets have decreased significantly, users do not need to panic, as Binance's financial situation is still healthy. Data shows that the exchange holds a total value of $160 billion in 34 different crypto assets, and these assets are reserved at a ratio of 1:1 or higher.