Binance CEO Interviewed For The First Time After The FTX Meltdown

The Binance CEO – CZ believes the experience was terrible for the sector, as it resulted in a significant reduction of consumer confidence after one of the largest crypto enterprises collapsed overnight after being detected misappropriating user funds.

In 2022, the cryptocurrency exchange FTX joined the ranks of other failing enterprises by declaring bankruptcy, with Terra (LUNA), 3AC, Celsius, and Voyager. Binance CEO – CZ predicts a new age of more regulatory scrutiny in the near future as a result of the devastation created by multi-billion dollar losses incurred by enterprises and investors.

CZ viewed the sudden collapse of one of the largest crypto firms as catastrophic for the sector, saying it eroded trust in the sector and drove away many potential customers.

“I think fundamentally we’ve been set back a few years already,” he remarked at the Indonesia Fintech Summit 2022. 

Historically, KYC and AML rules have been at the center of cryptocurrency regulation (AML). CZ has long held the view that exchange activities, such as business models and verification of reserves, should be the primary focus of regulatory efforts. Consequently, he anticipated the imminent arrival of more stringent regulatory inspection of crypto company operations.

Even though ordinary investors will feel the effects of FTX’s demise in the short term, in the long run, this should serve as a wake-up call for conversations about how to address risks across crypto ecosystems. 

Regarding FTX in particular, he stated that “the last three days have been nothing but a catalog of issues. The issues have persisted for much longer. The issue has been around longer than the last three days”

The Binance Leader stated that the abundance of FTX Tokens in Alameda Research‘s financials was the final straw that prompted him to decide to liquidate Binance’s nearly $2 billion worth of FTT assets.

The following day, FTX CEO Sam Bankman-Fried contacted CZ with a deal that “did not make sense from a lot of fronts.” Additionally, CZ was seeking an OTC agreement for user safety.

“Our initial thought was let’s save the users, but then we heard about the misappropriation of user cash, notably the investigations by the U.S. Regulatory Agencies, and we knew we couldn’t touch that anymore.”

CZ feels that the crypto business would benefit greatly from greater transparency and from regulatory agencies being better informed on crypto audits and cold wallet data. Achieving a reasonable normative equilibrium is no sweat, he said.

In an effort to win back the trust of its clientele, Binance has launched a new website dubbed “Proof of Assets,” which lists the on-chain transactions made by the exchange’s hot and cold wallet addresses.

Binance claimed in an official statement, “Our goal is to empower users of our platform to be aware and make informed decisions that are compatible with their financial goals.”

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

Join us to keep track of news: https://linktr.ee/coincu

Website: coincu.com

Chubbi

CoinCu News