Tuesday, June 28, 2022
Home Crypto News Exchanges Unlike Coinbase, CZ Says Binance Will Refund Users First Before Shareholders If...

Unlike Coinbase, CZ Says Binance Will Refund Users First Before Shareholders If the Exchange Goes Bankrupt 

- Advertisement -

Binance said it will put the interest of its users first before its shareholders in the event that the exchange goes bankrupt.


Following the recent debate over Coinbase’s user refund policy in the event of a bankruptcy, Binance, the world’s largest cryptocurrency exchange by trade volume, has disclosed that it will always put its users’ interests first over shareholders’. 

The CEO and founder of Binance, Changpeng Zhao popularly referred to as CZ noted in a now deleted Ask Me Anything (AMA) session that if the exchange ever goes bankrupt, it would first of all refund its users before its shareholders. 

“Funds would be refunded to users first, before any shareholders, ”CZ was quoted as saying in the AMA session. 

Coinbase Under Fire Over Its Disclosure

This comes less than two weeks after the San Francisco-based cryptocurrency Coinbase declared in its Q1 2022 financial report that should it go bankrupt, it would hold on to customers’ funds as part of its property while referring to these users as “unsecured creditors.” 

The caveat prompted many cryptocurrency experts to call on Coinbase users to remove their funds from the exchange as they may lose their funds to the trading platform if it ever goes bankrupt. 

CZ’s Concerns for Retail Investors

CZ has always been concerned about the well-being of retail users over major investors. Following the recent collapse of the TerraForm Labs ecosystem tokens, CZ urged the Terra team to make small investors whole before taking care of its large investors. 

Binance’s CEO made this suggestion despite seeing its $1.6 billion worth of LUNA holdings turn to $3,000, following the crash of the crypto’s price. 

“To lead by example on PROTECTING USERS, Binance will let this go and ask the Terra project team to compensate the retail users first, Binance last, if ever,” CZ said in a tweet last week. 

Aside from the fact that Binance will prioritize its users before shareholders in the event that the exchange goes bankrupt, CZ also talked about other issues, including Terra. 

It is no longer news that CZ is furious with the Terra team. He has publicly condemned how the firm handled the de-peg of its stable coin, resulting in a massive fall in crypto prices. 

According to the Binance CEO, investors would not have suffered major losses if only Terra deployed its reserve earlier than it did. 

- Advertisement -


The content is for informational purposes only and may include the author’s personal opinion, and does not necessarily reflect the opinion of TheCryptoBasic. All Financial investments, including crypto, carry significant risk, so always do your complete research before investing. Never invest money you cannot afford to lose; the author or the publication does not hold any responsibility for your financial loss or gains.

Albert Brownhttps://thecryptobasic.com/
Albert Brown is a cryptocurrency investor and journalist who has been in the nascent space since 2017. His love and passion for technological innovations made him delve deeper into the world of blockchain and cryptocurrencies. As a journalist, Brown has written on several crypto-related topics that have been referenced by popular industry players like Tyler Winklevoss, Binance CZ, etc.


Please enter your comment!
Please enter your name here

- Advertisment -

Recent News & Articles

Crypto Winter Survival Guide: Frax (FRAX), PAX Gold (PAXG), And RoboApe (RBA)

How long will crypto winter last? That is the question on the lips of every crypto participant right now. Many newbies are scared at...

The Exciting Evolution Of Blockchain Gaming With Xchange Monster (MXCH) & Decentraland (MANA)

The words decentralized finance and game, these two industries have been combined together and from this combination the GameFi sector was birthed. For many...

TRON Price On The Up As Risk Of USDD Depegging Falters

  Tron Price is showing that the USDD depegging pressure is releasing. window.coinzilla_display = window.coinzilla_display || ; ...

Bitcoin Only Line Of Defense Is Holding But How Far? As Number Of BTC Exchange Inflows Increase

  Bitcoin does not have sufficient support below 20,000 dollars. window.coinzilla_display = window.coinzilla_display || ; ...

Baby Doge Coin Team to Burn 50 Quadrillion BabyDoge At Once

Baby DogeCoin Team to Burn 50 Quadrillion Coins Tomorrow After Community’s Approval.  window.coinzilla_display = window.coinzilla_display || ; ...

SEC Chairman Piles Pressure on Altcoins, Says ‘Bitcoin Is the Only One I Am Willing To Say Commodity’ 

For SEC Chairman Bitcoin is the only crypto that is a commodity. window.coinzilla_display = window.coinzilla_display || ; ...

Shiba Inu Soars Above 40% In Seven Days As Unification Brings Shibarium Launch Closer

SHIB has put smiles on investors' faces after its massive rally in the past seven days.  window.coinzilla_display...

Subscribe To Our Newsletter

Get Updated with All The latest Crypto News, Articles, Reviews, Analysis and much more. Delivered Every Monday.