On March 10, Changpeng Zhao (CZ), the CEO of Binance, stated that the crypto exchange is not at risk related to the controversial US bank Silicon Valley Bank (SVB).
Funds of Binance users are safe
After reports that some crypto banks such as Circle and now-bankrupt lender BlockFi had exposure to the embattled company, it was necessary to reveal this information. CZ stated that Binance has no exposure to the bank and users’ funds are safe. This was through a Twitter message confirmed.
Conversion from USDC to BUSD (temporarily) stopped
Binance has temporarily stopped the automatic conversion of USD Coin (USDC) to Binance USD (BUSD) due to the current market conditions. The crypto exchange stated that it was experiencing large inflows that increased the conversion burden. “This is a normal risk management procedural step as we monitor the situation,” she added.
Binance joins an increasing list of crypto exchanges that have stopped supporting conversions to USD Coin (USDC) due to issues with SVB. Other exchanges on the list include Coinbase and Crypto.com.
While some within the crypto community described USDC’s current situation as karma due to its alleged role in BUSD’s prior regulatory issue, CZ indicated that he believes that “[Circle] has done nothing to hurt BUSD. Anything that hurts a player hurts itself.” It certainly wouldn’t have been a deliberate move with this. Earlier today it was announced that USDC has lost its peg to the US dollar. Do you want to know more about this? Click here to go to the relevant article.
Does Binance want to buy a bank?
Zhao also hinted that he might consider buying banks in response to the recent problems with crypto-friendly banks. CZ shared a news report from 2022 stating that Binance was considering acquiring a bank. However, he said he was “not sure” if it was a good time for the stock market to buy a bank.
It wouldn’t be the crypto company’s first strategic acquisition. Binance has already made several investments in traditional institutions. For example, in 2022, the company invested $200 million in the media company Forbes. Moreover, she also supported Elon Musk’s acquisition of Twitter.
Finally, Binance is not the only one with the idea of acquiring a traditional bank. Earlier, the American cryptocurrency exchange Kraken had already shared its intentions to take over a bank. Finally, however, it is not known how serious these intentions are and how far they are in the takeover process, if it had already started.