Binance cold wallet sent $3.9 billion worth of USDT days before guilty plea

Binance and its former CEO have pleaded guilty to federal charges of over $4.3 billion

November 22, 2023 05:36 am

Wit Olszewski/Shutterstock modified by Blockworks

Binance sent $3.9 billion worth of stablecoins from one of its cold wallets to a separate Binance wallet days before the announcement of a settlement on US federal charges amounting to over $4.3 billion.

On-chain data from TronScan shows that a multi-billion dollar transaction was completed on Nov. 9 from a wallet labeled ‘Binance-Cold 2’ to a wallet labeled ‘Binance 3’.

The ‘Binance 3’ address, created in August 2022, currently holds $3.6 billion worth of assets, with the majority of it being tether (USDT). At the time of writing, it has a lifetime transaction count of only 338.

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A majority of the 88.3 billion USDT currently in circulation has been issued on Tron, about 46.8 billion, compared to 40 billion on Ethereum, according to Tether.

‘Binance-Cold 2’ currently has $6.6 billion worth of assets remaining, with a total of 2498 transactions since it was first created in November 2018.

Binance has previously noted in a blog post that its cold wallets, otherwise known as offline wallets, are responsible for receiving overflow funds and holding the bulk of the company’s funds.

There are currently 12 total publicly tagged Binance wallets. Six of them are ‘hot wallets,’ and three of them are ‘cold wallets,’ the remaining three wallets are simply named ‘Binance 1,’ ‘Binance 2,’ and ‘Binance 3.’

In connection with the Binance settlement, its CEO, Changpeng Zhao, pleaded guilty to various federal charges, has stepped down from his CEO position.

Binance has agreed to pay a criminal fine of $1.8 billion, and an additional $2.5 billion will be forfeited. Approximately $1.6 billion of these funds will be credited towards resolutions Binance made with CFTC, FinCEN, and the Treasury’s OFAC.

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