Binance CEO Changpeng Zhao(CZ) shared his views relating to the current FTX debacle with the Binance neighborhood, stating FTX taking place shouldn’t be good for the trade as it’ll welcome harder rules across the globe.
“Don’t view it as a “win for us. Consumer confidence is severely shaken. Regulators will scrutinize exchanges much more. Licenses across the globe might be more durable to get,” CZ mentioned within the assertion.
In response to more durable rules, the CEO mentioned that Binance would “considerably” improve transparency, proof of reserves, insurance coverage funds, and extra.
The assertion from CZ got here after Binance introduced buying FTX, which led to large hypothesis that drove BNB costs however later introduced down the entire market amid general bearish sentiments. Earlier, Binance determined to promote all its FTT reserves which led to an enormous withdrawal of property from the Bahamas-based cryptocurrency change.
However, the Binance CEO confirmed that the announcement of the acquisition of FTX that adopted was not pre-planned and revealed that he was unaware of the inner state of FTX.
“It was lower than 24 hrs in the past that SBF known as me. And earlier than that, I had little or no information of the inner state of issues at FTX. I might do some psychological calculations with our revenues to guess theirs, however it will by no means be very correct,” Zhao mentioned.
In the meantime, the CEO hinted that he might nonetheless stroll away from the acquisition deal. Nevertheless, whereas the due diligence on the deal remains to be ongoing, Zhao revealed that he had ordered his change, Binance, to cease the sale of FTT and warned others to not purchase and promote FTT tokens.
Earlier, Zhao warned actors towards borrowing to run a crypto enterprise. CEO believes FTX’s troubles supply classes to different actors within the trade.
Two large classes:
1: By no means use a token you created as collateral.
2: Don’t borrow when you run a crypto enterprise. Do not use capital “effectively”. Have a big reserve.
Binance has by no means used BNB for collateral, and now we have by no means taken on debt.
Keep #SAFU.🙏
— CZ 🔶 Binance (@cz_binance) November 8, 2022
Additional, in a separate Twitter post, he known as on all crypto exchanges to hold out proof-of-reserves to boost the transparency of person funds.
