Etherscan Shows an Institution Withdraws $450M USDC From Circle

• An institution withdrew $450 million USDC over the past 24 hours.
• The massive withdrawal came after the SEC reportedly charged the BUSD issuer.
• The US regulator claimed BUSD was a security token.

On-chain data shows that one of the large corporations holding Bitcoins (BTC) has continuously withdrawn USDC stablecoin from its issuer, Circle, and transferred to Binance exchange. According to the whale’s last 25 transactions on Etherscan, the total outflow over the past 24 hours was $450 million.

Lookonchain, a crypto analyst account on Twitter, hinted that the same investor had withdrawn large sums from BUSD stablecoin from its issuer, Paxos, before the US Securities and Exchange Commission (SEC)’s recent action against the firm.

A crypto enthusiast commented that these massive withdrawals, coming at the right time, proved that institutions and funds have insider knowledge on everything. The commenter added that large investors will use retail investors ‘as exit liquidity every chance they get.’

On February 12, the Wall Street Journal reported that the SEC had sent a Wells Notice to Paxos Trust Co — a document used to inform businesses of an impending enforcement action. The notice alleged that the Binance USD (BUSD) was an unregistered security.

However, the CEO of Binance, Changpeng Zhao, previously argued that the BUSD issuer was under the New York Department of Financial Services (NYDFS) regulation. Additionally, in a report, a Paxos spokesperson disagreed with the SEC’s belief that BUSD was a security token, and stated that the firm would litigate the matter vigorously if forced.

According to Investopedia, a prospective defendant is allowed 30 days after receiving a Wells Notice to respond via a legal brief to argue why the charges should not be brought against them.