TokenAnalyst, a leading provider of real-time and historical blockchain data has estimated that the capital outflow from major crypto exchanges amounts to around $622 million in the past five days itself. The crypto exchanges that it mentions include big names like Bitfinex, BitMEX, Binance, and Kraken.
We earlier have reported in our article about the ongoing controversy involving the crypto exchange Bitfinex and its platform’s stablecoin coin Tether. The New York Attorney General’s office has accused Bitfinex of losing $850 million in user deposits and has imposed an injunction upon it following which both Bitfinex and Tether have rejected the claim and have said that they have opposed and contested against the imposition of the injunction order.
Bloomberg has further cited TokenAnalyst and reported that Bitfinex outflows amounted to around $1.7 billion in Bitcoin (BTC) and Etherum (ETH) since April 26, 2018. The users of Bitfinex have faced a huge amount of losses because of these outflows. Bloomberg also states that following these controversies Bitfinex has still been able to raise fresh $1 billion investment via the sale of LEO tokens.
John M Griffin, a professor of Finance at the School of Business, The University of Texas at Austin has said to Bloomberg, “since Tether is insufficiently backed, it means that some of the reserves backing customer assets on exchanges are likely insufficient.” John M Griffin further noted that:
“Smart customers will not custody their funds on exchanges and pull their crypto off exchanges. This could put further upward pressure on Bitcoin prices as one would rather take fake money and exchange it to Bitcoin.”