A astounding $524 million worth of BETH was just burned by Binance, one of the biggest cryptocurrency exchanges in the world. You are not the only one who may be perplexed by what just occurred. Here’s why even industry experts were perplexed.
Binance generated more than $500,000,000 worth of BETH over the weekend, a cryptocurrency linked to Ethereum’s Beacon chain. The fact that this sum represents over 50% of all BETH in existence is fascinating. However, there was no apparent “burning” or activity on the blockchain to support such a large-scale minting.
The fact that Binance’s ETH2 deposit account showed no evidence of this significant transaction added still another degree of intrigue. And in case you were curious, there were exactly eight BETH transactions in the last 12 hours, just like WBETH (Wrapped ETH), its counterpart. Who is utilising all of this WBETH on Layer 1 of Ethereum, then? That is the $524 million question, if you will, or the million dollar question.
Following this mysterious action for two days, Binance proceeded to burn the full $524 million BETH. Why? The answer, however, is not simple. Even seasoned market players struggle to completely comprehend the complexity of BETH and WBETH, which are sophisticated financial products.
They are essentially Ethereum tokens wrapped to represent other assets, facilitating simpler trade and increasing liquidity. But it is still unclear why Binance would mint so much and then burn it off so quickly.
According to one opinion, this might be a calculated manoeuvre to influence the market or change liquidity. There’s also a chance that Binance is testing brand-new financial goods or services. Whatever the reason, Binance’s massive operation raises concerns and doesn’t look well for the company, which is still under regulatory review.