Binance's CZ calls for stable and clear regulations in crypto industry amid FTX bankruptcy
2 min read 14 Nov 2022, 03:46 PM ISTThe billionaire who goes by the nickname CZ believes that it's not 100% responsibility of the regulator to protect consumers, but also a collective role of the industry.
PremiumWorld's largest crypto exchange in terms of trading volume, Binance's CEO and co-founder Changpeng Zhao said there is a need for stable and clear regulations for the cryptocurrency industry in wake of Sam Bankman-Fried's FTX insolvency proceedings. The billionaire who goes by the nickname CZ believes that it's not 100% responsibility of the regulator to protect consumers, but also a collective role of the industry.
In a gathering of G20 leaders at a summit in Bali, Zhao said, "we're in a new industry, we've seen in the past week, things go crazy in the industry," adding, "we do need some regulations, we do need to do this properly, we do need to do this in a stable way," reported Bloomberg.
Further, Zhao also said, "I think the industry collectively has a role to protect consumers, to protect everybody. So it's not just regulators. Regulators have a role but it's not 100% their responsibility."
CZ's comments come after Bankman-Fried's FTX Group on November 11 filed for voluntary proceedings under chapter 11 of the United States Bankruptcy Code in the District of Delaware. FTX Trading, West Realm Shires Services (FTX US), Alameda Research, and approximately 130 additional affiliated companies (together with the FTX Group) have filed for insolvency.
Also, Bankman-Fried has resigned from his post as CEO at FTX Group. John Ray III has been appointed in his place as the CEO. Not just that, Bankman-Fried's entire $16 billion wealth was wiped out -- making it one of the greatest-ever destructions of wealth in history according to the Bloomberg Billionaire's index.
FTX's decision for Chapter 11 is to provide the Group the opportunity to assess its situation and develop a process to maximise recoveries for stakeholders.
FTX filed for bankruptcy after sister company Alameda's balance sheet raised questions which led to a series of free falls in native token FTT. Also, Binance liquidated its holding in FTT, and then withdrew its plan to bail out crisis-laden rival exchange FTX.
In the past seven days, FTT tokens have nosedived by over 93%. FTX's token is struggling around $1.5 levels. Millions of dollars of market cap has been wiped in the past few days.
FTX crisis is another shock to the crypto markets and it has put a dent in investors' trust.
Earlier today, through its Twitter account, CZ also said, to reduce further cascading negative effects of FTX, Binance is forming an industry recovery fund, to help projects who are otherwise strong, but in a liquidity crisis. CZ said, more details on this will come out soon.
Additionally, CZ also said they welcome other industry players with cash who wants to co-invest. He tweeted, "Crypto is not going away. We are still here. Let's rebuild."
On CoinMarketCap, Binance's native token BNB is trading higher by nearly 2% in the last 24 hours. However, its weekly performance has witnessed a decline of nearly 15% as of now.
