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Binance CEO Changpeng “CZ” Zhao has denied allegations that Binance is secretly selling Bitcoin (BTC) to artificially stabilize the price of its Binance Coin (BNB) token.
The rumors came from several market commentators, including analyst Dylan Leclerc and Swan Bitcoin CEO Cory Clippsten, who accused Binance of deliberately manipulating the market to artificially inflate the value of BNB.
In a June 13 tweet, CZ revealed that Binance had not sold any of its BTC or BNB, adding that the cryptocurrency exchange still holds a “bag” of FTX tokens (FTT), the native tokens of the now-defunct FTX cryptocurrency exchange.
4. Binance have not sold BTC or BNB. We even still have a bag of FTT.
It is amazing they can know exactly who sold based on just a price chart involving millions of traders. FUD. ♂️ pic.twitter.com/M3MUH2bFRE
— CZ Binance (@cz_binance) June 13, 2023
“It’s amazing that they can know exactly who sold based on just a price chart with millions of traders. FOOD,” he added.
CZ’s post was in direct response to a June 14 post by technical analysis platform Skew that accused Binance of manipulating the market through a series of trades involving BTC, BNB and Tether (USDT):
“Binance is definitely up to something to prevent the crash of BNB and BTC.”
In the same thread, bitcoin analyst Dylan Leclerc stated that “BNB is clearly a fake market” that trades with less realized volume than BTC.
In a June 13 tweet, Corey Clippsten, CEO of Swan Bitcoin, also stated that Binance is engaged in “dummy trading” and stated that Binance is “trying to pretend” that BNB support exists:
Wash trading like craaaaaazzzzyyyyy on Binance right now trying to pretend there’s support for BNB. This looks sooooooo bad for CZ.https://t.co/qCHjQCSXwD
— Cory Klippsten ️ Swan.com #Bitcoin (@coryklippsten) June 12, 2023
Fake trading is a market manipulation tactic in which a trader sells an asset and then buys it shortly thereafter to inflate demand or give the impression that there is increased activity in the market.
Analyst Joe Consorti of The Bitcoin Layer also described BNB’s price action as “out of the ordinary” and the “$220 level” is “strongly protected.” He suggested that this could be the liquidation level for the BNB-backed loan.
Unusual price action on Binance.
Loads of selling pressure on bitcoin not present on other exchanges.
More cannon fodder that they may be selling spot BTC to prop up BNB.
The $220 level is being staunchly defended — may be a liquidation level for a BNB-collateralized loan. https://t.co/EYfLJ1KIcX pic.twitter.com/7XGNLlzcpf
— Joe Consorti ⚡ (@JoeConsorti) June 13, 2023
In response to the post, CZ Consorti stated that Binance must release a verified statement proving that Binance has no BNB-collateralized obligations in order to terminate FUD.
On the subject: 70% of unregulated exchange transactions are fictitious: NBER study
On June 5, the US Securities and Exchange Commission filed a lawsuit against Binance. US for alleged violation of securities laws, as well as engaging in fictitious trading through its “principal undisclosed trading firm Sigma Chain”, which is owned by CZ.
CZ and Binance. The US denies wrongdoing and intends to “strongly” defend the charges against them in the US District Court in Washington, DC.