CZ Rationalizes BNB’s 44% Ratio In Binance SAFU Funds
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In response to concerns that Binance is setting the BNB ratio too high, which accounts for 44% of the $1 billion Binance SAFU fund, CZ has offered some plausible explanations for the ratio.
Today in his share, CZ explained the rationality of the BNB ratio in the SAFU fund. In it, the Binance executive said the ratio has been roughly split between BTC, BUSD, and BNB. It’s just that the price of BNB has grown faster than BTC since the last rebalancing. In addition, he also announced that the industry recovery fund worth $1 billion will be BUSD.
#Binance SAFU insurance fund ($1 billion USD equ) is roughly split between BTC, BUSD, and BNB. Just that BNB price rose faster than BTC since last rebalance.Yesterday, #Binance allocated ANOTHER $1 billion to the industry recover initiative.Both publicly on the blockchain. https://t.co/Dpu9tNx5NQ— CZ Binance (@cz_binance) November 25, 2022
This is as a response to online analyst Willy Woo’s concern about the riskiness of BNB. Earlier, he tweeted that online data shows that Binance’s $1 billion Secure Asset Fund for Users (SAFU) will consist of 44% BNB, or $367 million; BUSD accounts for 32%, or about 300 million USD; Bitcoin takes the lowest, 24%, or about 270 million US dollars. Willy Woo says that a high BNB rate is “disturbing”.
On November 9, Changpeng Zhao, tweeted: “In response to recent price movements, Binance has once again loaded the SAFU insurance fund equivalent to $1 billion in crypto, where $700 million is in BUSD and BNB, $300 million in BTC.”
SAFU was created in 2018 to protect Binance users’ funds in the event of a disaster. After being gradually funded through trading fees collected by Binance, it officially opened in January 2022 at a $1 billion valuation. Since then, the crypto market slump has pushed its spot market valuation to around $837 million.
As updated in an earlier Coincu News article, yesterday, Binance will allocate US$1 billion to buy underperforming assets and release Web3 Industry Recovery Initiative (IRI).
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