For those conversant with social media platforms, especially Twitter, one of the most popular trends within the crypto community is the Binance FUD news. If you are conversant with the crypto industry, it may be easier to understand the meaning of FUD.
FUD means Fear, Uncertainty, and Doubt; it is a situation where fear, uncertainty, and doubt are disseminated to the public. Those who use this tactic come up with all sorts of inaccurate and false information about a particular cryptocurrency or exchange to manipulate public opinion.
This is the type of situation currently happening with Binance; the company has pointed out a couple of tweets that have been targeted against them, making their customers panic and doubt their services and products. Rumors are flying around about the US Attorney’s Office investigating the exchange for money laundering and payout issues.
With all the drama going on, many crypto enthusiasts are confused about what is happening and what to believe about the Binance FUD news. Is the recent news and rumors about the largest crypto exchange true, or are some people trying to pull down the exchange using FUD?
Which Crime is Binance Accused Of?
It has been a wild scene on Twitter as many rumors are flying around on so many things about Binance. The first rumor was that the crypto exchange had halted the withdrawal of some cryptocurrencies. A move like this is suspicious because this is exactly how crypto exchanges folded up in the past started misbehaving.
Travis Kling of Ikigai Asset Management accused the exchange of stopping the withdrawal of certain cryptocurrencies. He tweeted, saying, "Ok, this is super super shady. Binance just suspended USDC withdrawals on ETH and BNB chains. Given the circumstances, this is the last thing you want to see. @binance? @cz_binance?"
However, the CEO of Binance, Changpeng Zhao, was there to get the record straight with a blog post tweeting that the halt on the withdrawal of some cryptocurrencies was a planned move for maintenance. In his words, the CEO said," Yo, what's with all the FUD? This maintenance was announced a week ago. Also done now. All resumed."
Apart from the withdrawal issue drama, another notable Twitter user, Coinmamba, accused Binance of closing down his account and making away with his cryptocurrencies. However, a critical look at the evidence and what happened showed that Coinmamba was trying to create a FUD situation and was spreading false information to the public.
From Coinmamba's tweets and that of Binance, the crypto user had accused Binance of closing his account and making away with the money. But the fact was that he compromised his wallet keys and was trying to make Binance pay for his loss. Because of spreading false information, Binance put his account in withdrawal mode; this allowed him to withdraw all his funds from the exchange within 48 hours.
He had accused Binance in a tweet, saying, "Yeap, @cz_binance just closed my Binance account because of my tweets. Not sure what to say. This is unacceptable and I’m sure most of you will agree with me on this.."
Binance made a reply under the tweet, and it read, "It appears you are still confused in regard to the reason your account was put into withdrawal-only mode. @CoinMamba, here is a screenshot of your conversation with our CS agent."
Diminishing Crypto Reserves
Another rumor is that Binance's crypto reserve is reducing, which can pose a great threat to users' assets, assuming it is true. Many users are already concerned about the state of their funds, as a confirmation of this story might mean that some users may have their funds stuck in the centralized exchange.
However, a comparative evaluation of this story shows that it is more fake news than fact. A critical analysis of the story shows that it was put out to create FUD among Binance users.
According to data provided by Defi Llama, the crypto reserve of Binance has lost about $3 billion and is now at $63.5 billion. The data above is normal and does not depict any dwindling crypto reserve. Despite all the FUD many people are trying to create about Binance reserve, Wintermute Trading has withdrawn about $153 million worth of USDC from Coinbase. They later transferred $149.85 million of USDC to Binance.
Mainstream Media After Binance
It looks like individuals aren't the only ones trying to create a FUD around Binance; mainstream media outlets such as Reuters made an article that suggested that the federal government and the US Justice Department are considering charging the crypto exchange with money laundering.
An article they wrote stated how the US Justice Department was "divided" about taking the CEO of Binance and other executives over money laundering charges. They even suggested that Binance has been used for illegal activities since 2018.
However, Binance has once more cleared its name from the rumor with a tweet that read, "Reuters has it wrong again. Now they’re attacking our incredible law enforcement team. A team that we’re incredibly proud of – they’ve made crypto more secure for all of us."
At the moment, everyone is waiting to see the next moves of the US Justice Department. Whether they will charge Binance and its executives with money laundering or not. Also, crypto regulation is set to become strict as the government tries to ensure users' funds are kept safe and secure.