In response to the FTX collapse, Binance CEO Changpeng Zhao “CZ” said they are allocating $1 billion in ‘recovery funds’ for six months to help address the liquidity crisis faced by crypto exchanges.
What Happened: In an interaction with Bloomberg, CZ alleged that his initial offer to acquire FTX FTT/USD came to a halt after he looked at the company’s data room where “lots of funds (were) missing. These were all ‘double-digit billings'.
"So I couldn't trust anything in their data room.”
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When asked about Genesis facing liquidity, CZ said “There are different numbers floating, and these numbers change every minute.”
But even if Genesis goes down, “the industry will survive”.
He believes that to retain investors, small institutions will be hurt in a scenario if Genesis collapses. However, “the beauty of decentralization will get the industry back on its feet.”
On acquiring Voyager, the Binance CEO said its US arm will make another bid soon.
Binance was the first company to publish proof of reserves to ensure that investors do not panic and trust centralized exchanges.
“Many other exchanges are trying to copy us, but are facing issues,” CZ said, adding that publicly listed companies “don't list their assets directly, they hire a third party to do so and that becomes less transparent since it's in US dollar and not in crypto assets particularly.”
Price Action: At the time of writing, FTT was trading at $1.30, down 2.59% in the last 24 hours, according to Benzinga Pro data.
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