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Coinbase avoided this fate by being a us regulated company. FTX.us is still above water. It’s the Bahamas based company that was able to cook the books and is n

Coinbase avoided this fate by being a us regulated company. FTX.us is still above water. It’s the Bahamas based company that was able to cook the books and is now defunct. As for Binance, they have the SAFU (https://academy.binance.com/en/glossary/secure-asset-fund-for-users https://academy.binance.com/en/glossary/secure-asset-fund-fo...) which they just topped up to $1B at current market prices (today). You can verify the balances on chain, but there aren’t any statements about outstanding obligations, and there are no guarantees that those funds haven’t been earmarked for other things.

TedDoesntTalk 4y ago
Coinbase is listed on NASDAQ and has significant reporting requirements because of that. Civil and maybe criminal penalties for the board if they lie on SEC filings.
hanniabu 4y ago
> FTX.us is still above water FTX.us has been under SEC investigation for security fraud for months, so still too early to make this call
- djbusby 4y ago
  They making the claim of "above water" for $NOW. It's not to early call $NOW but it is too early to call $NOW+30D
denlekke 4y ago
$1B doesn’t rly reassure me unless I’ve misunderstood. Ftx had $6B in withdraws in 72hours (which they fulfilled) so I don’t rly think binance has shown anything that would provide real protection against a bank run like we just saw.
- deleted 4y ago
  [deleted]
dav43 4y ago
So their "Secure Asset Fund for Users (SAFU)" are crypto funds. If that's not pulling the wool over everyone's eyes. This industry needs to die.
digianarchist 4y ago
How are they insulated from each other? I always assumed that one holds the other. Correct me if I'm wrong?
015a 4y ago
About 40% of the SAFU is in BNB; their own FTT-like token. Its literally the same reason FTX collapsed; BNB just still has value.
- 55555 4y ago
  Yeah agreed. This seems needlessly risky.
- matheusmoreira 4y ago
  BNB isn't a token though. It's a real cryptocurrency like ETH.
  - 015a 4y ago
    Sure, but the point is that if Binance were ever in a position to where they needed to start liquidating the SAFU, its reasonable to assume that the market for BNB would be in a very poor state; either because of whatever caused them to need to liquidate the SAFU, or because of the liquidation itself. BNB's typical 24h volume is only around 8x the total amount of BNB in the SAFU. More broadly, the existence of the SAFU should raise eyebrows. If they're acting as a depository trust, in other words maintaining a 100% reserve ratio, then why does the SAFU need to exist? Maybe just marketing? Giving cryptobros something to point at to say "Binance is safe"? I guess that's fine. I don't know; just weird. Its like, imagine if JP Morgan only dabbled in 0% interest checking accounts, literally just took your money and put it in a box, then said "we've got a billion dollars here to pay out in case we go bankrupt. Half of it is in JP Morgan Stock, that should be fine right?". The situation doesn't make much sense to me, but I may be missing something.
paxys 4y ago
> FTX.us is still above water I wouldn't be too sure of that. Sequoia just emailed all their LPs saying that they are marking down their investment in FTX.com and FTX US to $0.

TedDoesntTalk 4y ago

Coinbase is listed on NASDAQ and has significant reporting requirements because of that. Civil and maybe criminal penalties for the board if they lie on SEC filings.

hanniabu 4y ago

> FTX.us is still above water FTX.us has been under SEC investigation for security fraud for months, so still too early to make this call

djbusby 4y ago
They making the claim of "above water" for $NOW. It's not to early call $NOW but it is too early to call $NOW+30D

denlekke 4y ago

$1B doesn’t rly reassure me unless I’ve misunderstood. Ftx had $6B in withdraws in 72hours (which they fulfilled) so I don’t rly think binance has shown anything that would provide real protection against a bank run like we just saw.

deleted 4y ago
[deleted]

dav43 4y ago

So their "Secure Asset Fund for Users (SAFU)" are crypto funds. If that's not pulling the wool over everyone's eyes. This industry needs to die.

digianarchist 4y ago

How are they insulated from each other? I always assumed that one holds the other. Correct me if I'm wrong?

015a 4y ago

About 40% of the SAFU is in BNB; their own FTT-like token. Its literally the same reason FTX collapsed; BNB just still has value.

55555 4y ago
Yeah agreed. This seems needlessly risky.
matheusmoreira 4y ago
BNB isn't a token though. It's a real cryptocurrency like ETH.
- 015a 4y ago
  Sure, but the point is that if Binance were ever in a position to where they needed to start liquidating the SAFU, its reasonable to assume that the market for BNB would be in a very poor state; either because of whatever caused them to need to liquidate the SAFU, or because of the liquidation itself. BNB's typical 24h volume is only around 8x the total amount of BNB in the SAFU. More broadly, the existence of the SAFU should raise eyebrows. If they're acting as a depository trust, in other words maintaining a 100% reserve ratio, then why does the SAFU need to exist? Maybe just marketing? Giving cryptobros something to point at to say "Binance is safe"? I guess that's fine. I don't know; just weird. Its like, imagine if JP Morgan only dabbled in 0% interest checking accounts, literally just took your money and put it in a box, then said "we've got a billion dollars here to pay out in case we go bankrupt. Half of it is in JP Morgan Stock, that should be fine right?". The situation doesn't make much sense to me, but I may be missing something.

paxys 4y ago

> FTX.us is still above water I wouldn't be too sure of that. Sequoia just emailed all their LPs saying that they are marking down their investment in FTX.com and FTX US to $0.