Cryptocurrencies offer a way to transfer value quickly and cheaply, without the need for a third party. This could lead to increased uncertainty and volatility in the crypto market.ĭespite the challenges, the crypto industry has the potential to revolutionize the way we think about money. The SEC has already filed charges against several cryptocurrency exchanges, and it is likely that more enforcement actions are on the way. And as the industry grows, regulators are starting to take notice. The lack of regulation in the crypto space has made it a haven for fraud and abuse. Schroeder's departure is a blow to Binance, but it is also a sign of the challenges that the crypto industry is facing. This comes at a time when the crypto industry is under increasing scrutiny from regulators around the world. John Ray III, the bankruptcy expert who succeeded Bankman-Fried as the head of FTX as part of its winding-up process, told a congressional hearing on Tuesday that he had “never seen such an utter lack of record keeping” as he did at the exchange, which had “absolutely no internal controls whatsoever”.Binance, the world's largest cryptocurrency exchange, has announced that its US CEO, Brian Schroeder, is stepping down. The various charges include multiple counts of wire fraud and securities fraud, campaign finance violations, and money-laundering offences.īankman-Fried was denied bail in the Bahamas, where he is being held pending extradition to the US. The jitters over Binance came as Sam Bankman-Fried, the founder and chief executive of FTX, once Binance’s chief rival, was charged by the SEC, CFTC, and Department of Justice for his role in the catastrophic failure of his crypto exchange. In a tweet, Zhao said the company would be doing an independent audit on liabilities, but that “liabilities are harder”, adding: “We don’t owe any loans to anyone. We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. For more information see our Privacy Policy. Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. Withdrawals of USDC, a “stablecoin” that is widely seen as one of the safest assets in the sector, since it is issued by a US-based company that complies with financial regulators and pegged to the US dollar, were paused for more than eight hours over the course of Tuesday. We passed this extreme stress test because we run a very simple business model – hold assets in custody and generate revenue from transaction fees.”īut the outflow came after Binance was forced to halt withdrawals in one particular cryptocurrency because, Zhao said, the company could not fulfil them until its American banking partners opened for business. In a statement from Binance, the company said: “We think that it’s important to note that yesterday’s market sell-off resulted in approximately $1.14bn being withdrawn from our platform in a 12-hour period, which was managed with ease.
Zhao insisted that Tuesday was not even in the top five days for net withdrawals. “I actually think it is a good idea to ‘stress test withdrawals’ on each CEX on a rotating basis,” he added, with a biceps curl emoji. Some days we have net withdrawals some days we have net deposits. “We saw some withdrawals today,” Zhao tweeted on Tuesday.
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