The world of cryptocurrencies is no stranger to whispers, controversy, and conjecture. Recently, the community has been abuzz with claims regarding Binance’s Changpeng Zhao, better known as ‘Zhao’, and the protection of his digital brainchild, the Binance Coin (BNB).
Accusations range from the alleged manipulation of market dynamics to defend BNB from price plummets, to the undue influence on Bitcoin’s value.
Zhao’s trading transactions under scrutiny
In the labyrinthine alleys of Twitter, one user, @JW100x, brought forward an assertion that has ignited a flurry of speculation. The tweet suggested that Zhao, and by extension, Binance, had been executing a series of strategic transactions.
These operations were allegedly designed to safeguard BNB from a threatening ‘liquidation waterfall’. The mechanism of this supposed safeguard involved selling off spot Bitcoin to purchase BNB, purportedly preserving BNB’s $220 level.
This move, however, was claimed to cap Bitcoin’s potential upward trend, essentially crafting a “house of cards”.
Further substantiation of these claims was provided by another Twitter user, @52kskew, who agreed that there were indications of Bitcoin being exchanged for USDT reserves, which were then funneled into BNB.
This conversion process was reportedly used to prevent volatility in both Bitcoin and BNB markets, with Bitcoin’s downside volatility being suppressed by channeling BUSD into it.
This strategic deployment of assets, if true, could certainly be construed as an example of market manipulation.
Despite the waves of suspicion, Zhao was quick to rebuff these allegations with a simple yet robust response: “Binance have not sold BTC or BNB. We even still have a bag of FTT”.
Zhao underlined the implausibility of determining a specific seller based on the price chart involving millions of traders, branding the allegations as FUD, or Fear, Uncertainty, and Doubt.
Legal wrangles amid market turbulence
While this online brouhaha unfolds, Binance has been wrestling with a more tangible foe, the U.S. Securities and Exchange Commission (SEC).
A recent order from a judge asked Binance and the SEC to explore an agreement that would secure U.S. assets while permitting Binance’s operations to persist. In the wake of this order, Binance is required to disclose a list of business expenses.
This lawsuit, coming hot on the heels of Binance’s competitor FTX filing for bankruptcy, has stoked fears of an extended tumultuous period for the crypto market. This unease has been further exacerbated by the fact that Binance Coin has dipped by more than 20% since the SEC’s action.
Given these events, it is crucial to remember that while the cryptocurrency world is a thrilling and potentially lucrative landscape, it is also a realm of unpredictability and volatility.
As this story unfolds, the crypto community will be watching closely to see whether Zhao can successfully navigate this storm and uphold the integrity he has been known for in the industry.
