Binance has strongly refuted claims that it was making profits on 60,000 BTC on BitMEX when the COVID market crashed in March 2020.
Changpeng Zhao denied that Binance was the cause of a Bitcoin selloff or the cancellation of the crypto supercycle.
In response to X to a user who wrote that the exchange had made a profit of more than 240 million in hedging the positions of its clients when the market broke down, the former CEO of Binance replied.
Zhao denied the allegation as being untrue and unsubstantiated.
Binance was not traded on BitMEX
Zhao made it clear that Binance did not trade on BitMEX.
This withdrawal plan by the derivatives exchange, he quoted, and added that BitMEX co-founder Arthur Hayes would mean a lot in case this kind of profit took place.
The purported profits would have been impossible to make daily on BitMEX, he said. Zhao proposed that the rumors drive away less-experienced users to the other platforms.
In the crash in March 2020, Bitcoin fell roughly between $8000 and $3800 within a few hours, and this led to a liquidity crisis among the exchanges.
BitMEX alone liquidated $750m of Bitcoin in a few minutes.
The world markets too responded negatively, with the Dow Jones declining by more than 2,000 points and the oil price declining by 22%.
Criminal charges against Binance are false
Zhao also responded to the allegations that Binance sold Bitcoin to cause price drops or abort the crypto supercycle.
He stressed that the balance in the wallets of Binance will fluctuate only when the user withdraws the money.
The majority of the customers hold their balances on the site, which means that Binance does not actively price-manipulate.
He attributed the claims of $1 billion of Bitcoin sales to undermine the market to normal user sales.
ADSAFU reserve conversion completed
Recently, Binance had converted its SAFU reserve to 1 billion BTC, and in its emergency funding plan, it had bought 15,000 BTC.
According to Zhao, the acquisitions were made in batches via centralized exchange liquidity instead of the decentralized platforms.
The relocation enhances the risk management and emergency funding policy of Binance.
Binance is still under investigation, yet the answers by Zhao seek to address the false information on social media.
This is by responding to fake accusations of COVID crash gains, market manipulation, and trading measures, which makes Binance a credible and transparent platform.
