This particular story would be extremely bad for the world of Crypto. Binance's asset shuffling eerily similar to Maneuvers by FTX if true, and right now it's just being alleged. This could prompt a very, very steep sell-off In the world of crypto, Here's what you need to know when you're the world's largest Crypto: Exchange in a largely unregulated Market It is easy to make up the rules as you go. In the latest backroom maneuver, Binance transferred 1.8 billion with a B in Stablecoin collateral to hedge funds including Alameda you might have heard of that artist formerly of the rock band FTX and Cumberland Drw, leaving its other investors exposed late last year.

As crypto markets were struggling to rain their footing, the world's biggest cryptocurrency exchange quietly moved 1.8 billion of collateral meant to back its customer stable coins, putting the assets to other undisclosed uses. That's a no-go You can't do that. They did this without informing their customers. According to the blockchain data examined by Forbes From August 17th early December About the same time FTX was imploding, holders of more than one billion of crypto known as B Peg Usdc tokens were left with no collateral for instruments that Binance claimed would be 100 backed by whichever token they were pegged to be Peg Usdc tokens or digital replicas of Usdc a dollar Peg Stablecoin issued by Boston-based Circle Financial that exists on blockchains not supported by the firms such as Binance's proprietary Finance Smart Chain.

Each stable coin is worth one US dollar. The tldr of that is the way Binance was telling the world: hey, no, you have a hundred percent of the thing that you think you have. It looks like that's now coming into question and that for obvious reasons can be extremely problematic. Also, I want to point out now that I've read this multiple times, the timing of it really crazy.

Don't forget November This went on till December with Finance November is when things like really really hit the Japan in terms of FTX of the rated customer funds which consisted of USD Stablecoin tokens 1.1 billion which channeled to Cumberland Drw, a Chicago-based high frequency training firm whose parent was founded in 1992 and began trading crypto in 2014. Cumberland may have assisted Finance in the efforts to transform the collateral into its own binance. USD Stable coin until a Crackdown in mid-February by the New York State Department of Financial Services on stable coin issuance, Finance was aggressively seeking to gain market share for its dollar back token against Rivals Like Tether and circles Usdc, this is posted by Forbes If you want to go through the run-through of what they were doing like the specific technicals I Highly implore you to do so. But as you can see, the real main thing in the story is things that should have been fully backed weren't and it all happened without customer approval and definitely without customers knowing what was going on.

It is difficult to ignore similarities to the transactions that contributed to the crisis and collab at FDX while FDX allegedly ran into trouble by misappropriating customer deposits to benefit the sister hedge fund Alameda What You need to know: there is basically people were putting money into the FTX exchange and then that was being funneled to a hedge fund to chase their bad bets and they blew it up. even worse. in this circumstance, Binance seems to have taken funds that customers had reason to believe were dedicated collateral and used them for its own purposes. These actions may have not been illegal simply because Binance is not regulated like a regular Financial firm and purchasers of the Bpeg token did not sign investment contracts with the exchange so not the exact same.

I Don't want you to take this video of like oh, exactly what FTX is doing is what Binance is doing No, no little different and it seems like they're able to get away with whatever they're being accused of here by the fact that a lot of crypto is not regulated, so technically not breaking the law might be a little bit dubious, might cause your iron allows to raise a little bit, but potentially not illegal, but still very suspect. No matter how this goes, you need to know when it comes to the world of crypto, not your keys, not your coin. I am still a supporter of crypto. particularly.

Bitcoin you might be, you might not be, but if you are, keep your crypto in your own wallet I would even take it a step further and say going to a cold wallet, but there's absolutely no reason to leave your crypto on any exchange and all these yield products they've proven themselves to basically be. BS I Still support crypto, but let's just be a little bit more intelligent or let's say, risk inverse of where we're keeping our crypto because you don't need to get caught up in another. Celsius Voyager FTX All of it like that's just to name a few and the list can go on and on and on. Protect yourself.

That extra risk is way too outsized compared to that small yield product. It's just not worth it. It is simply not worth it. Now, obviously this is a pretty big story and it could have massive impacts on the world of crypto.

So as it develops I'll happily cover any of those developments. For right now, the Tldr is: protect yourself.