Binance CEO Shares "Two Big Lessons" After FTX Liquidity Crisis
CZ took to Twitter on November 8 to share "two big lessons" crypto companies should learn amid the fall from FTX crypto exchange.
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Binance CEO Changpeng “CZ” Zhao shared his take on “two big lessons” from the FTX saga, saying cryptocurrency companies shouldn’t use their own tokens as collateral and should also keep "large reserves".< /p>
In a tweet on November 8, Zhao shared two lessons after the significant “cash crisis” at FTX, which ultimately resulted in a non-binding letter of intent from Binance to acquire the struggling exchange.
Two big lessons:
1: Never use a token you created as collateral.
2: Don't borrow if you run a crypto business. Do not use capital "efficiently". Have a large reserve.
Binance has never used BNB as collateral, and we have never incurred any debt.
Stay #SAFU.
— CZ Binance (@cz_binance) November 8, 2022Zhao shared that her first lesson is to make sure a company's collateral isn't a token she created, and claims that her exchange's token - Binance Coin (BNB) - n 'has never been used as collateral for its services.
FTX's liquidity issues appear to have arisen after a November 6 tweet from Zhao saying that Binance would be liquidating its holdings of FTX tokens (
CZ took to Twitter on November 8 to share "two big lessons" crypto companies should learn amid the fall from FTX crypto exchange.
New
Binance CEO Changpeng “CZ” Zhao shared his take on “two big lessons” from the FTX saga, saying cryptocurrency companies shouldn’t use their own tokens as collateral and should also keep "large reserves".< /p>
In a tweet on November 8, Zhao shared two lessons after the significant “cash crisis” at FTX, which ultimately resulted in a non-binding letter of intent from Binance to acquire the struggling exchange.
Two big lessons:
1: Never use a token you created as collateral.
2: Don't borrow if you run a crypto business. Do not use capital "efficiently". Have a large reserve.
Binance has never used BNB as collateral, and we have never incurred any debt.
Stay #SAFU.
— CZ Binance (@cz_binance) November 8, 2022Zhao shared that her first lesson is to make sure a company's collateral isn't a token she created, and claims that her exchange's token - Binance Coin (BNB) - n 'has never been used as collateral for its services.
FTX's liquidity issues appear to have arisen after a November 6 tweet from Zhao saying that Binance would be liquidating its holdings of FTX tokens (
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