Bitcoin core developer, Jeff Garzik, sides with Binance
Sequel to Binance’s liquidation announcement of its FTX tokens, CZ and Jeff Garzik lends their wisdom to the crypto world.
Jeff and Zhao lend their wisdom to the crypto world
Following the announcement of a possible Binance buyout of troubled crypto exchange FTX, Binance’s chief executive, Changpeng Zhao (CZ), shared some advice and suggestions to the entire Crypto universe in the early hours of Tuesday, November 8, 2022, via his Twitter page. Last Sunday, Zhao announced on Twitter that he would sell Binance’s roughly $530 million holding of FTT, the native token of FTX. In this subsequent tweet, he shared ‘two big lessons’ with the crypto universe.
1: “Never use a token you created as collateral.”
2: “Don’t borrow if you run a crypto business. Don’t use capital ‘efficiently’. Have a large reserve.”
He further added:
“Binance has never used BNB for collateral, and we have never taken on debt.”
To corroborate Zhao’s tweet, Jeff Garzik, co-founder and CEO of Bloq, a blockchain enterprise software company, also took to his Twitter page to share his “Stock advice to new entrepreneurs running their first crypto company.”
In the tweet, he said:
“You are not a crypto hedge fund. Holding volatile Crypto as a core balance sheet asset is risky and unwise.”
Crypto market going through hard times
Zhao’s suggestions came after he offered to buy out FTX following the concerns raised around the latter’s financial health and liquidity.
Zhao said his decision was triggered by “recent revelations” after a November 2 article by news site CoinDesk said much of the balance sheet of Bankman-Fried’s trading house Alameda Research is composed of the FTT token. He added that this liquidation would take a few months to complete due to market conditions and limited liquidity.
Zhao also said that all crypto exchanges should do Merkle-tree proof-of-reserves. A Merkle tree is a data structure used in computer science applications. Merkle trees encode blockchain data more efficiently and securely in bitcoin and other cryptocurrencies. They are also referred to as “binary hash trees.” He said:
“Banks run on fractional reserves. Crypto exchanges should not. Binance will start to do proof-of-reserves soon. Full transparency.”
The crypto market has faced a significant downfall because of the FTX exchange & its FTT token downfall.
Currently, almost all the coins are down by an average of 10%, except the ADA coin & BNB coin, thanks to the Binance- FTX controversy.
The current price of the BNB coin is $316.2, which is 1.23% down over the last 24 hours’ global trade price. This clearly shows that BNB coin is a leading crypto asset in the crypto space, as a haven.
BNB is the native token of Binance, the world’s largest crypto exchange
Who are CZ and Jeff Garzick?
Changpeng Zhao, also called CZ, is the founder & CEO of first ranked crypto exchange Binance. From 2021 to 2022, he gained huge popularity because of his net worth, which gave him a place as the richest person in the crypto world. Zhao remains ready to push crypto adoption via educational programs & meetings in the offline & online world.
Jeff Garzick is the co-founder of the company Block Inc. which is dedicated to software development blockchain at the business level.
Garzik is also an advisor to various companies in the Blockchain industry known worldwide, forming part of its boards of directors and advisory. Among the companies he advises are Center, BitFury, Bitpay, Chain.com, Netki, and laboratories Waypaver. He currently serves as the CEO of the Bloq company and is an active commentator on the crypto world on social media.
