CoinEdition
Published Mar 12, 2023 05:17AM ET
Updated Mar 12, 2023 05:30AM ET
“Banks Are a Risk to Fiat-backed Stablecoins,” Binance CEO Says
Changpeng Zhao, the CEO of Binance, the largest crypto exchange, expressed concerns on Twitter today about the safety of stablecoins baked with fiat currencies following the bankruptcy of two prominent banks in the United States.
“Banks are a risk to fiat-backed stablecoins,” Zhao tweeted. A Twitter blue subscriber reasoned that Bitcoin and other cryptocurrencies came to life to avoid the failures of the traditional financial system. “If you mix crypto with fiat, you get trapped,” they argued.
Some of the fiat-backed stablecoins on the market include USDT, with over $72 billion in market share, and USDC, with nearly $39 billion market capitalization. According to reports, USDC has over $3 billion in reserves in the troubled US Silicon Valley Bank.
Yesterday, the Binance CEO mocked US detractors as SVB and Silvergate became insolvent and unable to process customer withdrawals. “They FUD us, and banks fail,” Zhao tweeted, referring to how Binance remained strong despite the constant negative propaganda it suffered from US entities that hoped the exchange would fail.
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