Cryptocurrency exchange KuCoin has experienced a significant capital outflow, according to the Nansen portal. This comes after federal prosecutors and the US Commodities and Futures Trading Commission (CFTC) brought a number of charges against the company and its founders.
Over the past 24 hours, the total volume of funds withdrawn from the exchange’s accounts exceeded $882 million. At the same time, the inflow of capital amounted to 99 million. Thus, the net outflow of funds amounted to $783 million. The data covers the Ethereum, BNB Chain, Avalanche, Fantom and Polygon networks.
“Given past incidents, we expect that any large-scale regulatory action will lead to a sharp outflow of funds. However, for now, the exchange is able to hold customer deposits and funds in a 1:1 ratio, and remains solvent even under such stress,” said Martin Lee, head of communications at Nansen.
Analysts note that despite the significant amount of funds withdrawn, the company still has reserves of $5.1 billion. The exchange has 6,277 BTC and 99,359 ETH on its balance sheet, according to CryptoQuant. Experts say that the company has a fairly large “margin of safety.”
The movement of funds intensified after US authorities accused KuCoin and its co-founders Chun Gan and Ke Tang of violating the Bank Secrecy Act. The company and entrepreneurs are also suspected of participating in money laundering processes, deceiving investors and unregistered activities.
According to law enforcement, during its operation KuCoin received over $5 billion and transferred more than $4 billion in criminal and suspicious funds. The prosecutor's office brought charges against the co-founders of the company, as well as legal entities associated with it, on several counts. Each of them carries a prison term of five to ten years.
