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Changpeng Zhao: Binance Never Used BNB As Collateral and Never Was Indebted
Foxy - Coincu
2022-11-09 02:50
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After FTX’s liquidity crisis, Changpeng Zhao tweeted that there are two lessons to be learned. Besides, he also confirmed that Binance has never used BNB as collateral and that the exchange has never been in debt.
FTX’s severe liquidity crisis has caused the market to fall into chaos similar to the Terra-LUNA crypto crash in May. Before that, the owner of the major cryptocurrency exchange. The market leader has learned 2 lessons for companies.
- Never use a token you created as collateral.
- Don’t borrow if you run a crypto business. Don’t use capital “efficiently”. Have a large reserve.
Two big lessons: 1: Never use a token you created as collateral. 2: Don’t borrow if you run a crypto business. Don't use capital "efficiently". Have a large reserve.Binance has never used BNB for collateral, and we have never taken on debt.Stay #SAFU.— CZ Binance (@cz_binance) November 8, 2022
Besides, CZ also confirmed that Binance has never used BNB as collateral and the company has never been in debt.
As was updated in the previous post, the liquidity crisis of FTX erupted when Binance announced to withdraw investment by selling all FTT holdings that caused a massive sell-off of the token.
Over the past 72 hours, FTX has had to handle over $6 billion in customer withdrawals, causing the exchange to suspend deposits and withdrawals and seek help from Binance. The acquisition of FTX is also under consideration.
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