Following recent debates over Coinbase’s refund policy in the event of bankruptcy, Binance’s CEO says it will always put the interests of its users above those of shareholders.
First users, then investors
According to Changpeng Zhao (CZ), the CEO and founder of Binance, if the popular crypto exchange ever went bankrupt, users would be repaid first and then shareholders. He said the following in a now-deleted “Ask Me Anything” session:
“All funds should be returned to users first, then to shareholders.”
This now comes after Coinbase recently stated that if they ever go bankrupt, it would hold customers’ money as part of its property, labeling those users as “unsecured creditors”. This in turn has led to several crypto experts calling for all funds to be removed from the platform. This could also be bad for the profit & loss account of the crypto exchange for the coming quarters.
Small users for large users
It is not entirely unknown that CZ considers its retail users very important. After Terra recently experienced its massive crash, CZ urged the Terra team to put small investors ahead of the big investors. This while CZ saw its investment drop from approximately $1.6 billion to just $3,000.
According to Binance’s CEO, investors would not have suffered major losses if Terra had staked its reserve earlier than it did. Finally, he is furious with Terra’s team about how everything went.