Highlights of CZ’s Reddit AMA on May 21, 2022
Main takeaway
On Saturday, May 21, CZ spent an hour answering r/CryptoCurrency’s top questions.
CZ has also taken the time to reply to a selection of unanswered questions from the AMA session.
Getting in direct touch with the community is a vital touchpoint for Binance and CZ. We want to hear your opinions and make your voices heard.
As one of the industry’s most prominent leaders, there aren’t many crypto fans who wouldn’t have a few questions to ask Binance’s CZ. Here’s your chance to catch up with last Saturday’s AMA session and learn more about what’s on the community’s mind.
If one thing’s for sure, the crypto community has an appetite for direct questions and sincere answers. We all like to be in touch with the projects and services we support, and Binance is no different. As one of the most active crypto communities on the web, Reddit’s r/CryptoCurrency subreddit played host to CZ’s latest AMA on May 21. For those who didn’t follow it live, we’ve gathered here all the questions and responses posted. We’ve even included some unanswered topics that CZ has since covered, so there’s some new for everyone.
A Saturday Afternoon of Questions With Binance’s CZ
Some questions have been cut shorter to make them suitable for display, denoted with a *. We have also included a few unanswered follow-up questions in the first section, marked with a **. You can also follow the link if you’d like to see the Reddit thread firsthand.
1. “Why did you(CZ) resumed UST and LUNA trading knowing that it is a failed project and also Luna mint is still happening although you tweeted 'no more minting'?”
CZ - I saw this question earlier, but it looks like it disappeared as I was answering. It was the most upvoted at the time. Here’s my answer:
In a decentralized world, there are many other exchanges too. If we suspend trading, and prices move on other exchanges, what do you think the holders will say? We suspended trading briefly when the validators paused the blockchain, even that caused a lot of complaints, but I believe our action forced the validators to resume the network within a couple of hours. Lastly, no one is forcing anyone to buy just because trading is on. There are high risk tolerance buyers willing to take over from sellers. The market place is neutral.
2. “Can you please explain why you misrepresented UST repeatedly then deleted all tweets and promotional material stating that it was safe, stable and fiat backed right after it crashed? What are you doing to make this right?”
CZ - Binance always has risk warnings to users in all of our announcements. And to the best of my knowledge, we never said UST was “fiat backed”, etc. I’m 99% certain just a bad twitter conspiracy theory.
Not sure about the Binance main account, but I do delete tweets all the time, mainly due to a lack of edit button. I just asked our team about this, there were some tweets about a specific APY, which is no longer true, so they deleted it as to not confuse new users.
[Later reply]
Apologies, I didn't know this until now. Thanks for flagging it. I will check it. How long it was up for, etc. We do make mistakes. There was another incident where our team used a wrong logo for different project for a while, and then took it down, and corrected it, which I believe it the correct thing to do.
If you think this caused you issues, please contact our customer support. We will look at it in detail. I do not think our team intentionally did it, but will check for that anyway.
Lastly, it is always important to thoroughly research and learn about projects you invest in.
3. “Did Binance stake UST in Anchor protocol, to generate yield for users?”
CZ - Yes, there were some, as part of the Earn program. These programs are accompanied by user education and extensive disclaimers - we are transparent about how this works, and the risks associated.
(Read our blog post to better Understand the benefits and risks associated with Binance Staking)
4. “Is there any plan to make BNB chain more decentralized ? Currently 10k+ BNB needed to become a validator on your own,you also need to get a whole lot of BNB delegated to you as well. Very strict demands. Also there are only 41 validators nodes out of which 20 are always inactive, which makes BNB one of the most centralized coins.
Thanks for your time CZ!”
CZ - Honestly, I am not involved in the BNB chain decisions. I barely found out they went from 21 to 41 before they tweeted about it. I do talk to some of the key devs there. Will bring it up next time. My limited tech understanding is there is a trade off between number of nodes vs performance at this time of our blockchain evolution. We collectively need to work on faster tech for blockchain.
Also, the delegated proof of stake works in such a way that even though there aren’t that many nodes, you do have a choice on which nodes you want to stake too. Hope that helps.
5. “CZ, would you consider bailing out UST and taking over for Do Kwon as head of Terra LUNA?
1)You invest $3-6 billion to partially collateralize the remaining 10 billion UST
2)In return you/ Binance get a big allocation of new LUNA2 tokens.
3)To redeem UST, people have to buy and lock BNB for 3-7 years, for an amount of > 50% of their loss.
Why?
a) You would become the most beloved man in the crypto space and it seems like you could afford it. This might be the biggest financial loss in the history of the world and psychologically, people are devastated.
b). You would likely make money too, with BNB forced to be bought and locked, your new allocation of LUNA2
You would start a bull market and BNB could flip ETH in the process.”
CZ - I am humbled by such a request. Thanks for the trust in me. But short answer is: unlikely.
I am pretty busy already, and algo stable coins is not my speciality. We should each do what we do best. I hope the community eventually settle on a good solution, and we will be here to support it.
6. * “Will Binance distribute the LUNA v2 it receives against the user's holding on Binance at time of snapshots?
Do Kwon already tweeted that ONLY LUNA that is in the Terra ecosystem at the time of the snapshot will be eligible for the airdrop. Anyone holding on CEX's will NOT be eligible and will miss out!”
CZ - In general Binance works hard to ensure users that hold coins/tokens on our exchange can receive airdrops intended for holders. The exact details will be worked out after there is an official consensus on what the Terra team plans to do.
7. * “Does Binance take part in governance votes using customer staked assets?
Are there any plans to implement systems that allow your customers to partake in governance votes?
If Binance does indeed not vote on proposals what other steps do you take to help decentralize networks(similar or akin to the spread delegation's you did on the Binance Harmony wallet).”
CZ - No, we don’t. We don’t use user funds to vote. Binance does not get involved in other chain governance. We, as an exchange, like to stay neutral on these things.
** “What about that one time Justin Sun wanted to take control over the Steemit blockchain and you gave him a ton on user-owned STEEM tokens to get the job done?
Did you forget about that one or just deliberately ignornig that it ever happened?”
CZ - At the time, Binance had used its vote to approve what we thought was a regular upgrade/fork. In retrospect, this was a mistake, and I’ve already apologized for the issue. We all make mistakes. We all learn from them.
8. “If Binance goes bankrupt, are user wallets safe?”
CZ - User funds are kept separate from the exchange's operating funds. And, if this were to happen, funds would be refunded to users first, BEFORE any shareholders. Funds are SAFU.
9. “Why does Binance randomly lock customer accounts even though the customer is already verified for a long time. I am not asking for myself, but I have read such posts on the Binance Sub. Also even if customer re-verifies, many times the verification is failed? How is the customer able to gain access back to their coins if such an event occurs ? As this my biggest fear.”
CZ - KYC is not static. For example, in Europe there are newer KYC regulations, which means that users have to re-verify again their accounts even if they were verified some time before. I can appreciate that this can be frustrating. However, KYC is very important - and it is part of the systems in place to ensure that customers can gain access to their coins.
Sometimes, there is a legitimate Law Enforcement request that we have to abide by.
Also sometimes, there are false positives. For risk prevention on your account. For example, if you log in to your account from a different device, IP, or country, etc. That's to protect your account from potential hackers, etc.
All in all, Binance NEVER lock user funds without a solid reason. Sorry that you had a bad experience.
10. “When someone uses high leverage (I believe binance offers up to 100x) and the market turns against them and they get liquidated, where do their account funds go?
Does binance have the ability to trade against its own users in order to force liquidations?”
CZ - 1. they lost to the users who is the counterparty of the trade.
2. No. We wouldn’t have an exchange if we did that. It would be a pyrrhic victory to chase short term gains by trading against our users. Even ethics aside, it is not a good business decision. And we hold ourselves to a high ethical standard.
We even monitor some of our large clients who tend to provide a lot of liquidity in the market so make sure they don’t do that either.
Our job is to create a fair and equitable trading environment. Not saying that doesn’t happen elsewhere in the industry, but it is against our mission and my personal beliefs about what is right & wrong.
Interestingly, a couple of people tried to suggest this (not even against the users, just prop trading) to me in the past, and they no longer work in Binance.
11. “Is it in plans to incorporate Binance Academy into the main Binance app somehow as I believe many new users aren't aware of basic scam prevention and how to keep funds Safu. I believe a prompt to access information regarding scam prevention when registering on Binance will benefit newer members of the community greatly 👍”
CZ - We have big plans for the future of Binance Academy. User education is really important for us and the entire industry. Stay tuned.
12. “Hello Cz,
Moons Pizza Guy here (I sold 10,000 Moons for Pizza).
Can you open your Moons Vault? Click on “Vault” under you profile picture.
What are your thoughts about Moons?
Moons are the subreddit governance tokens developed by Reddit (Reddit Community Points), Moons are still on Reddit Arbitrum testnet and projected to go Mainnet after Arbitrum Anytrust release in the summer.
Moons are used for tipping, buying premium membership on Reddit, voting on governance polls and advertising on this subreddit in the future.
I have 164 Moons, that’s the number near my username”
CZ - I love seeing new use cases for crypto. And I think social media that leverages crypto has good potential. So it’s great to see big subreddits testing these systems to learn how they can be best applied and scaled for social media in the future.
13. “What do you like the most about Dubai and the UAE in general?”
CZ - Dubai is a very safe place to live, and the business environment is also quite progressive. Dubai is also well-located for travel and timezones as I have many calls with the Binance team all over the world. And it's nice and warm in the summer.
14. “Do you guys like dogs?”
CZ - I have been advised by my intern that this question is too divisive to answer publicly. But I’ll do it anyway.
If we’re talking about animals, NOT crypto, I like dogs, yes. I also like cats.
15. “Any plans to move Binance HQ to the Middle East?”
CZ - Over the years, I learned different people have different definitions of HQ. We have offices in Bahrain, Dubai, Abu Dhabi. Many of them are not small, and I do spend quite a bit of time in each place. I even tried to learn Arabic, but proved to have no talent in that department. :)
16. “Can you deliver me a pizza? I am hungry.”
CZ - Sure, come to France.
17. “Thanks for doing an AMA here! As you probably know is Reddit working with RCP in some subs like these. The official governance token here are Moons.
So the 2 questions everyone will ask here:
What is your opinion about RCPs?
When will Moons list on Binance?
Thanks for your answer!”
CZ - At Binance, we aim to provide more access to crypto and always make best efforts to list high quality tokens. Token listing on Binance goes through rigorous due diligence. We never talk publicly about what will be listed before it happens. The Binance listing team is firewalled from the rest of the business, the details are highly sensitive. For more information, here are some tips for listing your coin on Binance.com
https://www.binance.com/en/blog/all/binance-listing-tips-from-cz-421499824684902218.
18. “What steps does Binance take when stolen funds are deposited into its platform?”
CZ - We work very closely with law enforcement in these cases. For example, someone in the UK recently moved funds stolen from a Coinbase account into Binance. We froze the wallet immediately and are now working with the Met Police to return the money to the victim.
Our investigations team is full of industry experts, and continues to grow. We do everything we can to help crypto users in these situations.
19. “Why are all large exchanges not teaming up to form one giant lobbying alliance? We need government lobbying more than ever.”
CZ - I absolutely agree we should. Binance always takes a collaborative approach to growing the ecosystem. Not to be arrogant, for us, taking market share from a small exchange doesn’t really move the needle for us. Growing the industry does. But for some smaller players, they are only focused on taking market share away from us (and not the big picture).
We even saw some smaller exchanges in certain countries/regions lobbying against us, which hurt the entire industry and themselves in return. There are also different priorities and agendas in a decentralized world. Few exchanges offer the full product suites that we offer, we also saw some try lobbying banning of interest generating products, derivatives, etc. Not to mention different priorities on different geographic locations. Some are US focused, some are EU, etc.
Overall, we are trying to do this (lobbying alliance). Binance probably also talks to the most number of regulators around the world, and also has the heaviest voice. May take some time, and progress incrementally.
20. “Hi CZ, on twitter you recently stated that NFT ticketing and merchandise authentication are use cases that you would like to see in Binance ecosystem.
https://twitter.com/cz_binance/status/1522465910161879040
Why do you want to see these usecases?
Do you see NFT ticketing as a way to introduce more people to crypto? and eventually onboard them to binance?
When fans are willing put in a little to create a wallet to receive (free) NFT, of a concert of their favourite artist. It will could introduce a lot of new people to crypto
If you could trade crypto from the same wallet as you have your ticket, it could be a great way to onboard more users for binance aswell.”
CZ - The future of cryptocurrency and web3 more broadly is going to be all about utility. We always talk about striving to reach the “First Billion Users (FBU)” and how we can speed up widespread adoption quicker. It’s become clear to us that web3 has to either solve problems for people that web2 can’t and/or create new utilities for users that they don’t enjoy today. NFT ticketing is just one of the many potential use cases for this tech that we’re looking at.
Once people see that this tech can be useful and highly valuable to them IRL, they will be more likely to learn about crypto and be able to make an educated decision about whether investing is right for them.
21. “Where does BNB value come from? and why is it holding better than other coins in this bear market?”
CZ - A few different aspects to this.
The market decides the value, just like with any other asset.
If something is used by people, it has utility value. The more people that use it, the more value it should have.
The market decides value based on the number and the quality of reasons to hold or use the asset. BNB has hundreds of use cases, including being the native currency on BNB Chain, which has a popular community of builders and users.
BNB is community driven. The actual success and market standing can be attributed to the community builders and users that make the BNB ecosystem so strong.
Come and build with us!
22. “What are the regulatory risks to BUSD?”
CZ - It’s a broad question. Many regulators are certainly looking at stablecoins more closely. BUSD is issued by Paxos, a NYDFS regulated entity. It also has the highest fiat backing for all the major stable coins. Hope that helps you judge the risks of various stable coins vs BUSD.
23. “I’m a big fan and my questions are a tad personal. I would really appreciate a response.
How has the quality of your life changed now that you are worth tens of billions? How do you stay humble? Do you sometimes wake up and think this is not real?
Do you think the western markets will dominate crypto or will Asia?
How do invest your personal wealth? Do you diversity across fiat assets? Do you use the services or a wealth management outfit?
Once again, CZ, thank you for doing this. We love you!”
CZ - To be honest my life hasn’t changed that much. I work hard everyday because I enjoy it, and it is enjoyable. My job is the most meaningful thing I could do with my time/life. I feel very lucky to have this opportunity.
I’m now doing more traveling - meeting users, the community as well as governments and regulators. For example, I was in Germany this week. There are some benefits as I went to the Top Gun movie premiere in Cannes, which was fun. However, our team at Binance keeps me humble. I ended the week serving and delivering pizza.
Investment wise, I am not a good example. I don’t diversify. I recommend most people to diversify. But for me, I am all in Binance. I don’t have personal investments. Everything I do, I do it through Binance. Removes any potential conflict of interest concerns. I think it is a good way to lead the team.
My personal assets are simple too. I am all in crypto, BNB and BTC. I use my Binance Card everywhere I go.
Answering your questions that we didn’t get time for
24. “Are you acting like a federal reserve bank? Especially for monero?
It often happen with strong price movements that you close binance withdrawals for monero. Sometime for a long time. Your team is explaining it with network congestions. This is simply not true. Many monero people are assuming that you actually have not enough Monero and because of the privacy feature of monero it’s easy to act like a federal reserve because you cannot be proved otherwise.
Wouldnt it be better to show full transparency and show full balances/reserves for all coins which are listed on Binance?
Did you notice the monero run?”
CZ - When it comes to user funds, we don’t operate with fractional reserves. Your deposits on Binance are there and present. I understand it’s not the answer you want to hear, but the temporary halting of withdrawals, in this case, is due to the large backlog generated. As always, any funds held with Binance are always SAFU. Also, it's a lot of work to disclose all cold wallet addresses, they are public anyway, but we do change from time to time.
25. “Any coming plans to expand the Binance Visa Rewards Card outside of the EU?
Your competitor, Crypto.com is the only option for Australians at the moment.”
CZ - We’re currently working on expanding the countries Binance Visa Card will be available in. Make sure to check the landing page often for more updates.
26. “Hi CZ and thanks for answering questions.
What is with the Doge send fee, 5 Doge on Binance and 50 Doge on BinanceUS?
Both of which are significantly above the minimum recommended fee of .01 Doge per KB in the send
Sources*
https://www.binance.com/en/fee/cryptoFee
https://www.binance.us/en/fee/schedule”
CZ - First, it’s worth noting that Binance and Binance.US are separate entities, meaning they operate independently.
When it comes to the withdrawal fees, we (Binance.com) regularly reevaluate the levels due to fluctuations in the fiat value of tokens. We actually put a lot more effort and resources than people realize into finding the sweet spot for withdrawal fees. Our goal is to remain flat - not to make or lose money. In reality, some days we lose a small amount of money and some days we make a small amount due to withdrawal fee network costs. Over time, due to constant monitoring and updating, we’re able to stay close to flat.
27. * “Do you think your customer support level is high? Do you plan on improving it? What shall I do (a customer who used to love Binance but now for more than 8 months is stuck with long waiting answers with your customers support)? Is there any phone number I can call to?
Hope this question will get answered, because Binance customer support mistake and behavior cost me my health, time and money, and I just can't understand the insane gap between the image you create to the support I get.
Disclaimer: I'm a Binance user for years.”
CZ - I’m sorry to hear about the issues you’ve been having with our customer support team. Typically, we pride ourselves on fast answers from real human beings. Have you tried using our chatbot function and asking to be redirected to an agent? You can do this by clicking the chat icon in the bottom right corner of the support page and searching for your issue. Make sure to select the options that mark your question as unresolved. You’ll then be connected to a customer service representative.
Currently, our 24/7 phone support is currently only available to Binance VIPs.
Another option is to tweet our Binance Customer Support (@BinanceHelpDesk) | Twitter account. I hope your issue gets resolved shortly!
There’s Nothing Better than Talking to the Community Directly
If you missed out on getting your questions asked or answered, then don’t fret. CZ is regularly in direct touch with the Binance community through events, AMA sessions, and Twitter. You can keep up to date with CZ’s latest opportunities for discussion by following his personal Twitter.
The article was edited on July 27, 2022.