Binance Users Cut Ethereum (ETH) Holdings 4.61% in September, Proof of Reserves Shows

Where the Customer Book Moved in September

Binance customers stepped out of Ethereum (ETH) in September, cutting their ETH balances on the exchange by 4.61% while lifting their Bitcoin holdings 0.91% to about 688,573 BTC, according to the exchange's proof of reserves report. The document is a published reconciliation, a practice exchanges adopted after the FTX collapse of 2022, that compares what a venue actually holds in its wallets with what its customers have deposited. In value terms the September shift was nearly symmetric: customer ETH balances fell by roughly $499 million, while Bitcoin balances grew by close to $537 million, making BTC the only major asset in the report where customer money expanded. September 2026 is the reporting month, so the decline is a full-calendar-month figure rather than a rolling window. The October snapshot, dated October 1, spans eight listed assets, and ETH posted the steepest proportional decline of any major holding among them. The rest of the book drifted lower alongside it: customer holdings of Tether's USDT stablecoin slipped 0.87%, and balances of BNB, Binance's own token, fell 0.77%. The report records totals only, so it cannot show whether the same accounts sold Ethereum (ETH) to buy Bitcoin, but the direction of the aggregate is unambiguous. The Ethereum (ETH) price is one backdrop the document leaves out, yet the rotation coincided with a strong stretch for Bitcoin, which has climbed nearly 47% from its July low on the exchange's research figures. ETH's platform role gives holders sinks a plain settlement coin lacks: it is the base asset of the biggest smart contract network, it can be committed to staking, and every on-chain action burns a gas fee. As the largest proof-of-stake asset by market value, ETH typically sits in customer portfolios as a core holding, which makes a 4.61% single-month drawdown in exchange-held balances a sizable collective move.

Sentiment moved the same way as the balances. As October began, bearish posts about Ethereum (ETH) on social media outnumbered bullish ones: the asset drew 0.89 bullish comments per bearish comment across X, Telegram, Reddit and other platforms, its weakest reading since June 7, according to analytics firm Santiment's October 1 post. XRP sat even lower on the same measure at 0.67, though ETH is the asset that tracks this rotation. Fund flows ran the other way. US spot Ethereum ETFs, the vehicles that give stock-account investors direct ETH exposure, absorbed roughly $850.8 million across seven consecutive sessions in late September, while Bitcoin funds added roughly $3.08 billion across nine sessions in the same window, on aggregate fund-flow data. Wall Street, in other words, kept buying both assets through regulated vehicles even as exchange-held ETH thinned out. The two books were pulling in opposite directions on the same coin. The fund picture has swung hard this year: BlackRock's ETHA earlier led a record $19.9B spot ETF outflow before the late-September inflow stretch returned. Coverage behind customer deposits remains intact. Every one of the eight listed assets is backed above 100% of customer deposits, though the cushion is uneven. Against 688,573 BTC owed to customers, the exchange holds 691,004 BTC: a 0.35% surplus, about 2,431 BTC, which works out to roughly $208 million. ETH coverage is close to exact, with only about 3 spare ETH on top, and the biggest buffer sits in stablecoins, including an extra $1.24 billion in USDT. One caveat governs all of it: the disclosure is a wallet snapshot taken on a single day, not a full audit, and it does not cover the exchange's own liabilities. Whether the September rotation reaches price structure is a separate question, and our Ethereum technical analysis tracks that tape live.

@SantimentData · X post

Santiment's October 1 post.

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November Snapshot to Settle the Rotation

The September print is one line in an ongoing ledger. The document states the hard facts: roughly $499 million left customer ETH balances, close to $537 million arrived in Bitcoin, and each listed asset remains over-collateralized, down to the three spare ETH backing customer ETH. What it omits is motive: no account-level pairing, no trade history, no stated reason. Next month's report is the checkpoint: it will show whether the rotation was a one-month rebalance or a standing preference. COINOTAG's reading: exchange-custody ETH is thinning faster than any other major asset on that book, and we track both sides in our Ethereum coverage and our Bitcoin coverage.