Binance CEO Changpeng ‘CZ’ Zhao says the leading cryptocurrency is ready to support Terraform Labs and its community’s rise from the ‘ashes’. However, he expects the team behind the LUNA and UST tokens to offer more transparency and accountability.
LUNA and UST’s collapse this past week caused ripples and attracted a lot of attention from around the crypto community and elsewhere. Among these reactions have been “falsehoods circulating in crypto twitter,” regarding what happened.
1/8 These past weeks have proven to be a watershed moment for the crypto industry. We have witnessed the rapid decline of a major project, which sent ripples across the industry, but also a new found resiliency in the market that did not exist during the last market downswing.
— CZ 🔶 Binance (@cz_binance) May 15, 2022
Regarding Binance’s support for Terra, Zhao explained that his viewpoint is that “minting, forking, don’t create value.” According to him, mechanisms that allow for buying back,or burning work. However, this requires funds that Do Kwon and his Terraform Labs team may not have access to.
Binance will therefore work towards helping the team. But more needs to be done.
“In this regard, I would like to see more transparency from them. Much more! Including specific on-chain transactions (txids) of all the funds. Relying on 3rd party analysis is not sufficient or accurate. This is the first thing that should have happened,” he said.
Projects can and will fail, but…
Zhao acknowledges that failures can and will happen. Nonetheless, when such setbacks occur, it needs the team behind the project to be more transparent, act with speed and communicate. Owning up when failures happen is also vital, the Binance chief added in a Twitter thread on Sunday.
Zhao said Binance supported Terra’s first fundraising but not the second one. The leading exchange did not also acquire any TerraUSD.
“I am just hoping that the project teams can rise from the ashes and rebuild in a proper and sensible way. Regardless of my personal views, or the solution chosen in the end, we will always be here to support the community in any way we can”
Terra collapsed dramatically last week, with de-pegging of UST from the dollar sending both the stablecoin and LUNA to zero. Binance halted and then resumed spot trading for LUNA and UST.