CZ Credits Twitter User for Dispelling Rumors of Internal Chaos at Binance
Binance CEO Changpeng Zhao (CZ) thanked a Twitter user for clarifying rumors about Binance’s internal situation. The rumors suggested that Binance was selling its Bitcoin stash to protect the price of its native token, BNB. The rumors stemmed from a vulnerable BNB collateralized DeFi loan on Venus protocol that was nearing liquidation. However, CZ clarified that Binance was not involved in funding the loan repayment and that selling a small amount of BTC would not have a significant impact on Bitcoin’s price. He also suggested that some influencers may spread such rumors for their own financial gain.
Key Points:
- A Twitter user named zkHopium explained the origins of the vulnerable BNB collateralized DeFi loan on Venus protocol.
- The loan started with a 2 million BNB hack in October 2022, during which a hacker minted $600 million worth of BNB.
- The hacker deposited stolen BNB into Venus and borrowed $150 million worth of stablecoins, putting the funds at risk of liquidation if BNB’s price drops significantly.
- Venus whitelisted BNB Chain as the only eligible liquidator for the loan, and it has paid off $90 million so far.
- ZkHopium calculated that the loan’s liquidation threshold is $196, but it is unlikely that a massive amount of BNB will flood the market even if liquidation occurs.
BNB’s Potential Troubles and Binance’s Involvement
While the vulnerable loan presents a potential risk for BNB, the analyst doubts that a massive BNB market crash will happen. Additionally, CZ clarified that Binance is not funding the loan repayment and selling a small amount of BTC would not have impacted Bitcoin’s price significantly. He also suggested that influencers may spread such rumors for engagement and financial gain. This dispels previous rumors of internal chaos at Binance and executive departures being related to legal issues.
Hot Take:
The clarification by CZ and the Twitter user helps to debunk rumors of internal chaos at Binance. It highlights the importance of fact-checking and critical thinking in the crypto community, especially when it comes to rumors that can impact the market. The involvement of influencers and their potential motives for spreading such rumors also raises concerns about the credibility of information in the crypto space.
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