Binance's stablecoin reserves have been in a steady decline for nearly three months, dropping from a peak of over $43.6 billion to approximately $36 billion as of February 16, 2026. This contraction, reported by analytics firm CryptoQuant, mirrors patterns seen in previous bear markets and coincides with a period where whales cashed out Bitcoin, Ethereum, and altcoins through the exchange.
The outflows, which accelerated in December and January, saw a steeper drop of around $3 billion in the first two weeks of February. Analysts suggest the decline may signal a persistent loss of liquidity, recalling the liquidity crunch of the 2023 bear market. A significant portion of the outflows is attributed to panic withdrawals, spurred by social media influencers urging traders to move funds from Binance amid fears of insolvency. Total outflows across all crypto assets may have reached up to 30% of Binance's total reserves, with tokens like XRP seeing significant withdrawals and ETH reserves falling to 3.7 million tokens, their lowest since 2024.
Concurrently, a stark behavioral divergence between major exchanges was exposed during Bitcoin's recent drop toward $60,000. While Coinbase CEO Brian Armstrong described a "diamond hands" resilience among its retail users who continued accumulating Bitcoin and Ethereum, on-chain data painted a different picture for Binance. Analysis from CryptoSlate and CryptoQuant indicates Binance became the primary venue for frenetic selling, driven largely by recent buyers and mid-sized holders ("fish" and "sharks"), not long-term whales.
The Coinbase Premium Index, a key metric for US spot demand, remained predominantly negative during the correction, suggesting that while retail holders may have been steady, they were not the dominant marginal price-setting force. In contrast, Binance saw substantial inflows from short-term holders averaging about 8,700 BTC per day, which often precedes selling. This venue-specific selling pressure was significant enough to influence broader price discovery during a period of thin liquidity.
The liquidity drain extends beyond the exchange itself. BNB Chain, the native ecosystem, has also suffered significant net outflows, losing $219 million in liquidity over three months—the second-largest outflow after Arbitrum, according to Artemis data. Despite still hosting a lively meme token market and $5.7 billion in liquidity primarily via PancakeSwap, the decline in BNB's price to around $615 has diminished interest. The chain's loss of liquidity could affect the wider DeFi ecosystem, though it still maintains 4.4 million daily active users without rapid outflows.
