- Changepeng Zhao said, “If 100% of the users withdraw 100% of the assets, we’ll be fine.”
- Zhao added that the halting of USDC withdrawals was due to the bank’s conversion issue.
- Crypto businesses must “hold user assets 1-to-1 and that is what we do,” added Zhao.
In a recent interview, Binance CEO Changpeng Zhao (CZ) addressed the liquidity fears of crypto investors as he revealed that the firm has a “very solid revenue” and is a self-contained organization.
Commenting on the FUD, Zhao stated:
People can withdraw 100% of the assets they have on Binance, we will not have an issue on any given day. If 100% of the users withdraw 100% of the assets, we’ll be fine.
Zhao also reflected on the recent halting of USDC withdrawals, as he called the glitch far from being a liquidity issue. He added that it was a conversion issue that was going through the bank. The crypto exchange does not use customers’ money as they have a very solid revenue, added Zhao.
CZ said that the firm does the auto conversion of USDC which is not issued by the crypto exchange Binance. It is issued by New York‘s licensed entity. The reserves are thus in New York. He further explained that there are many different types of stablecoin on Binance which makes it difficult for users to find the best price. Binance only enables the conversion of 1:1 for these stablecoins.
However, that day, the bank that does the conversion opened 6 hours later, continued Zhao.
Zhao further commented that the firm does not operate on a fractional banking system and so crypto businesses must “hold user assets 1-to-1 and that is what we do.”
Zhao also clarified that, unlike FTX, Binance does not owe anyone any money. The firm does not have a loan from any other firm in the ecosystem and Binance is a self-contained organization, concluded Zhao.
Shock waves were sent across the Crypto Twitter, as Binance temporarily halted withdrawals of USDC because it was conducting a token swap involving the stablecoin.
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
