Speculation grows as Ceffu deposits nearly $1B BTC to Binance in three months

Ceffu, one of the biggest institutional custodians for Bitcoin (BTC), sent nearly $1B worth of coins in the past three months. Ceffu outflows to Binance coincided with other whale sales, often resulting in worsening BTC price drops. 

The Bitcoin and crypto custody service, Ceffu, has been transferring Bitcoin (BTC) to Binance in the past three months. The total potential sales are closing in on the $1B mark after the latest round of transfers. Ceffu holds more than $1.9B in overall assets even after the outward flows of BTC and Ethereum (ETH). 

Ceffu deposited another 1,347 BTC to Binance, bring up a total of 16,123 BTC in the past three months. Going by BTC market prices, the inflows are now above $950M, testing the market’s power to absorb selling. 

Ceffu also increased its USDC holdings, expanding to $104M equivalent after recent inflows. USDT in custody also increased in the past three months. Ceffu offers a mix of cold storage and prime wallets that combine cold storage with a hot wallet for fast asset movements. 

The Ceffu wallets now hold 9.748K BTC, breaking down below 10K coins just a day ago. One of the reasons for the series of deposits may be the expectation for a rapid price move. Sending the coins to Binance for trading may show readiness to trade more actively, or realize profits. 

Ceffu, formerly known as Binance Custody, is a closely tracked wallet. For some, it is a gauge to measure market sentiment. Overall, the inflows from Ceffu are easily absorbed, as other whales and institutional buyers continue their accumulation. 

Ceffu is also closely watched for its involvement with Binance US, which is prohibited from interacting with any entities related to Binance International. While Ceffu has claimed it is a separate entity from Binance and there is no mixing of funds, the US Securities and Exchange Commission has Ceffu under scrutiny as it recognizes it as a potential tool for moving US customer funds offshore. 

Leading exchanges log net BTC outflows

Leading exchanges are not affected by the occasional whale deposit. In the past month, most of the leading market operators saw significant net outflows.

Binance saw the biggest outflows of 59,412.73 BTC for the past 30 days. Even a day’s outflow easily compensated for Ceffu’s deposit. BTC prices now show no opportunities for fast profit-taking, except for short-term deals. BTC traded at $59,786.73, retaining its choppy sideways movement with the occasional swing trade from whales. 

Bitcoin exchange balances have inched down, with only targeted inflows from ‘smart money’ whales aiming to take profits. Exchanges hold 2.35M BTC, with a constant outflow trend since the start of 2024. 

Bitcoin balances on exchanges are at an overall low over the last five years. Previously, peak market action coincided with high reserves and a readiness to sell. 

Hacks, exploits, and failed exchanges are now making BTC holders much more cautious. The recent accumulation also increased the number of BTC held in large wallets with more than 1K or 10K coins. Renewed interest also comes from private buyers, including MicroStrategy. 

Additionally, some exchanges have switched to OTC deals and cold custody, not using their hot wallets to trade. 

Ethereum exchange reserves show a similar picture, with only around 18M ETH in exchange wallets in August. This is the lowest level in the past two years. Centralized exchanges remain large-scale holders of altcoins and smaller tokens, which are not considered valuable. 

Altcoins are often held in hot wallets due to the short time frames for pumps which also require faster trading facilities. BTC withdrawals suggest long-term confidence in the asset and a new accumulation cycle. 

Low exchange reserves are also sparking some fears of sufficient solvency. While most exchanges have known, transparent wallets, there are still worries about mixing coins or using them for yield. Holding BTC in a self-custodial wallet has become the norm among some buyers. 

Binance releases monthly reserve reports, citing both customer holdings and its own reserves. The report for September shows the exchange holds 106%, an excess of funds.

Customer balances are at 605,690.438 BTC, while Binance holds more than 647K BTC. The exchange uses third-party custody services for 20,371.384 from that balance. Most of Binance’s reserves are overfunded, which should be enough to calm fears of insufficient solvency.

Cryptopolitan reporting by Hristina Vasileva.