76% Of Binance Coin (BNB) Moved For $0.03
On Wednesday night, Whale Alert, a popular crypto wallet tracking Twitter handle, started to record a number of multi-million dollar transactions in quick succession. While the transactions, which were mainly ERC-20 token transfers, seemed normal at first, as the social media channel continued to tweet incessantly, it became apparent that something was amok.
After multi-million dollar transfers of 0x (ZRX), BNT, WTC, Whale Alert reported that 98,776,172 Binance Coin (BNB), nearly all of the asset’s circulating supply, was transferred out of Binance to an “unknown wallet.”
— Whale Alert (@whale_alert) November 29, 2018
This jaw-dropping amount of BNB, which amounts to a U.S. dollar value of $512 million, was moved for $0.03 in gas fees on the Ethereum blockchain, clearly accentuating crypto’s value as a near-instant, borderless, censorship-resistant, permissionless, decentralized, and trustless medium of value.
With what centralized financial system can $512 million be sent in a minute’s time? Even Bitcoin, arguably one of the slower blockchains, facilitates million-dollar transactions in the span of ten to twenty minutes, putting centralized ecosystems, like SWIFT, to shame.
“Unknown Address” Racks Up $1.2 Billion In Ethereum Tokens
In response to the surprising $520 million transfer of BNB, @IamNomad, a long-time crypto fanatic, commentator, and analyst, joked that Binance Coin’s “entire market cap moved,” asking if this transaction was somehow linked to Binance’s potential use of “new cold wallets.”
Nomad, seeking to find answers, apparently went on to ask Binance’s support team, asking the world-renowned exchange staff about the suspicious transaction. Per the commentator, the platform’s team reportedly exclaimed that “funds are SAFU,” in an obvious reference to one of 2018’s most popular crypto inside jokes. Obviously not satisfied by this answer, Nomad asked if there was a migration over to new infrastructure/BitGo’s services, or even if Binance got “rekt.”
However, Changpeng Zhao, CEO of Binance, evidently sought to calm investors’ qualms with the influx of outgoing Binance transfers, taking to Twitter to comment on the unique situation. Zhao, formerly of Bloomberg, noted that the address in question, which now holds a total of ~$1.2 billion in Ethereum-based tokens (presumably all of Binance customers’ assets and many of the exchange’s Binance Coin), is part of the platform’s efforts to beef up its operational security.
Nothing to worry about. Check the tx logs, plenty of tx FROM the new address TO our old wallets. No need to spread FUD. We are constantly working on beefing up our security even more. https://t.co/UnNJ5mH54g
— CZ Binance (@cz_binance) November 29, 2018
So for now, it seems that this case of Crypto Mysteries has been solved…
Transaction Fees Dropping: Bullish For Crypto
No matter the details of this recent event, the Binance-sponsored ERC-20 transactions, all of which were completed for less than a few dollars… total, underscores the growing theme of dropping transaction fees, even in ever-popular networks, like Bitcoin and Ethereum.
Binance just created the largest unspent transaction output existing today (but not all time) at 109k BTC (nearly $600M).https://t.co/Ot2ST37flU
— Antoine Le Calvez (@khannib) November 15, 2018
In mid-November, just weeks ago, Binance issued a record-breaking transaction, sending 109,000 BTC, valued at $600 million at the time, for a mere $8. This drop in transaction fees on Bitcoin can be attributed to the rise of Segwit adoption, along with the declogging of the network. In terms of Ethereum, the near-zero transaction fees can be attributed to again, a declogging of the network, along with less of hype for DApps.
But still, so I ask you again, with what centralized financial system can $600 million be sent in a dozen minute’s time?
Again, the answer to this question is likely na-da, hence the value of cryptocurrencies and blockchain technology. But then again, some issues still need to be resolved, such as the issues with fluctuations in digital asset value.
Title Image Courtesy of Jonatan Pie on Unsplash