In a recent episode of “The Market Report,” Marcel Pechman, an analyst and writer, delved into the proof-of-reserves of crypto exchange Binance. The report revealed a significant decline in USD Coin (USDC) balances, dropping from $3.4 billion on March 1 to just $23.9 million by May 1.
Insights from on-chain analyst Aleksandar Djakovic suggested that this decline indicated that Binance had used the $3.4 billion to purchase 100,000 Bitcoin (BTC) and 550,000 Ether (ETH), amounting to approximately $3.5 billion. The central question raised by Pechman was whether this investment had been initiated by Binance users, effectively distancing Binance CEO Changpeng Zhao and the company from direct involvement.
Pechman disagreed with this conjecture, although he acknowledged the possibility of the exchange accessing a portion of its USDC reserves for margin or derivatives trades. However, he found it implausible that the entire balance would be depleted without client awareness or impacting the exchange’s day-to-day functions.
Transitioning to the next segment of the show, Pechman discussed the imminent launch of a stablecoin by PayPal, which was announced on August 7. This stablecoin, issued by Paxos Trust and built on the Ethereum blockchain, had similarities to USDC and Paxos USD (USDP). Pechman, however, highlighted a distinguishing factor in the integration of the stablecoin with PayPal and Venmo.
Ultimately, Pechman concluded that there was no discernible benefit for end users to adopt this new stablecoin. He pointed out that other stablecoins offered both yield and a more extensive presence in the decentralized applications market.
Lastly, Pechman addressed rumors circulating about Huobi executives facing arrest by Chinese law enforcement within the cryptocurrency realm. He also raised questions about Tron founder Justin Sun and the peculiar drawdown of Tether (USDT) reserves from Huobi.
For further insights into these matters, viewers were encouraged to tune in to the latest episode of “The Market Report,” an exclusive show available on the newly launched Cointelegraph Markets & Research YouTube channel.