Binance tops up SAFU fund at $1 billion amid price fluctuations
Because the liquidity disaster and acquisition of cryptocurrency trade FTX continues, Binance CEO Changpeng “CZ” Zhao assured his neighborhood of insurance coverage of adequate funds backing the community.
In a tweet on Nov. 9, CZ stated that the trade has as soon as once more topped its Safe Asset Fund for Customers (SAFU) at $1 billion equal in mild of “current value fluctuations.”
To regulate to current value fluctuations, #Binance has topped up the #SAFU insurance coverage fund to $1 billion USD equal once more.
BUSD AND BNB handle about 700m: https://t.co/OMoB6HeR6r
BTC handle 300m: https://t.co/6kOJ1MZhMM
Transparency. 1/2
— CZ Binance (@cz_binance) November 9, 2022
The tweet included hyperlinks to 2 reserve accounts, one in all which holds each the Binance stablecoin (BUSD) and the native token of the community BNB (BNB) with an equal value of $700 million.
The opposite pockets revealed Bitcoin (BTC) holdings value round $300 million.
Binance’s SAFU started in 2018 by allocating 10% of the buying and selling payment right into a fund that’s solely devoted to backing up consumer holdings within the case of an incident. In February of this yr, the fund hit $1 billion for the primary time.
The crypto neighborhood on Twitter responded to the tweet with principally constructive reactions, applauding CZ for his motion. One consumer said, “all cryptocurrency corporations ought to have a Safe Asset Fund for Customers (SAFU) similar to Binance.”
Whereas others had questions concerning the sufficiency of the cap for funds within the reserve:
Does #Binance hold lower than $1 Bil in customers funds in hit wallets?
May there be any situation the place Binance wants greater than the $1B?
— Crypto King (@Cryptoking) November 9, 2022
These current tweets relating to the steadiness of the SAFU, got here after CZ pledged on Twitter the day earlier than for a Proof-of-Reserve mechanism for an in depth disclosure of liquidity.
The Binance CEO stated the trade will deploy a Proof-of-Reserve system which can make the most of Merkle Timber for “full transparency” with the neighborhood. Merkle Timber are a mechanism for encoding blockchain knowledge in a extra environment friendly and safe method.
The latest CZ tweets referring to Binance’s SAFU additionally ended with the one-word sentence: “transparency.”
Associated: Binance’s FTX acquisition seen as chess transfer by crypto neighborhood
This is likely one of the newest strikes within the back-and-forth between FTX and Binance, which has unfolded over the previous few days.
CZ has been lively inside the neighborhood throughout the entirety of the occasions. On Nov. 8, he tweeted his main takeaways from what has transpired to this point, which included not utilizing a local token as collateral inside the similar community and holding a big reserve.
