'Abnormal' Altcoin Trading on Binance 'Just Market Behavior,' Says CEO

https://decrypt.co/116917/abnormal-altcoin-trading-on-binance-just-market-behavior-says-ceo

Cryptocurrency exchange Binance issued a notice on Sunday acknowledging reports that a handful of altcoins were trading in an “abnormal” fashion on its platform. The exchange stated it would investigate the matter and take the appropriate actions against “suspicious accounts.”

Binance’s Chief Executive Changpeng Zhao, also known as “CZ,” later declared that the price movements appeared to be “just market behavior.” He explained that one account deposited funds into a trading account, started buying up certain coins, and that others followed suit.

However, he said that Binance did temporarily restrict accounts associated with the altcoin trading that took place, preventing them from being able to withdraw their funds. The decision was reversed after the company “received a lot of complaints on social media” from users in various countries, Zhao said.

In a subsequent Tweet, Zhao recognized there’s such a thing as “too much intervention” in maintaining an exchange that operates in an industry which centers around the notion of decentralization. There’s a “balance” to the appropriate amount of intervention, he said, adding that it’s sometimes worth letting similar situations “play out.”

In its statement, Binance claimed the trading activity in question on Sunday did not seem to be a result of compromised customer accounts or stolen API keys, but said that it would provide updates if more relevant information became available.

The clarification comes after one of Binance’s users, who has since had their account suspended, expressed concerns last week that an API key was leaked through intermediary trading platform 3Commas, which led them to lose funds.

The user, who goes by CoinMamba on Twitter, exchanged a series of tweets with Zhao over the funds that went missing. CoinMamba stated “it would be nice” to get a refund but was mostly upset about the lack of prompt action.

Zhao replied it was not a situation that warranted a refund, adding that it’s important for one to keep their API key secure.

In a now-deleted Tweet, Zhao also said he was also considering restrictions on CoinMamba’s account in addition to 3Commas because Binance doesn’t “want to service people that are being unreasonable.”

CoinMamba later claimed that his account was closed because of statements he made on Twitter. The Twitter account for Binance’s customer support team replied, claiming that CoinMamba’s account was set to “withdrawal only mode” because of “threats” the user allegedly made.

3Commas had put out a press release on Saturday to address questions about attacks on their platform and API keys. The post urged users impacted by attackers to file police reports as quickly as possible so funds can be frozen and potentially recovered. It also warned 3Commas’ users to beware of phishing attacks.

On Sunday, 3Commas also posted a statement on Twitter that claimed “false rumors” were being spread online by “bad faith actors” which accused the platform of leaking users’ API keys. 3Commas said the rumors were related to fake screenshots.

Binance, 3Commas and CoinMamba did not respond to immediate requests for comment.