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I was checking my Binance Bitcoin address (where i have been holding some amount for last one year) on blockchain explorers, but it shows that the btc from that address was immediately spent within a few hours of transfer.

Does binance move all the bitcoin to another address and just maintain a balance of my wallet? When moving these funds from my address to their address, does it not incur a charge to them for making this unnecessary transaction?

Fairly new to the cryptocurrency ecosystem and want to understand how things work. Any help would be appreciated

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Does binance move all the bitcoin to another address and just maintain a balance of my wallet?

Yes. Most of the exchanges move bitcoin from hot wallets to cold storage after deposit. Balance that you see in your account is just a number in database maintained by Binance.

Example of one such transaction: http://web.archive.org/web/20191114203553/https://twitter.com/prayankgahlot/status/1195076733629657089

When moving these funds from my address to their address, does it not incur a charge to them for making this unnecessary transaction?

Yes. Every Bitcoin transaction requires fees. Both address and associated private keys belong to Binance. It is possible that most of the transactions either use less fee rate or batching to avoid paying huge fees for internal transactions.

Its not unnecessary and required for better security.

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  • Thanks a lot for the explanation. Can you tell a bit more about batching. How can we send from multiple addresses to a single address with minimum fees. Any documents related to batching? Dec 29 '21 at 9:53
  • bitcointechtalk.com/…
    – Prayank
    Dec 29 '21 at 10:28

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