- Binance says it won’t be bailing out any failed crypto projects.
- Binance has labeled some initiatives as bad and says that they should not be saved.
- Companies suffering in the crypto sector are seeking their competitors for help as no central bank would rescue them.
Binance has said that it has no plans to bail out any failed projects after news that struggling cryptocurrency lender BlockFi and Voyager would get assistance from cryptocurrency exchange FTX, and speculations began to circulate that Binance, which has a solid cash reserve, may also announce some bailouts.
In a blog post dated June 23, The biggest cryptocurrency exchange in the world has identified some projects as “bad” projects. These should not be kept for the future. Regrettably, several of these “bad” projects already have a sizable user base, which was often attained by means such as exaggerated incentives, “creative” marketing, or straight-up Ponzi schemes.
The statement added that in any industry, there are always a greater number of unsuccessful ventures than there are successful ones. It is Binance’s Changpeng Zhao’s sincere hope that the number of missteps is very little in comparison to the number of accomplishments.
Bailouts here don’t make sense. Don’t perpetuate bad companies. Let them fail. Let other better projects take their place, and they will.
Companies that are struggling in the cryptocurrency market are looking to their competitors for assistance since there is no central bank that is prepared to save them.
Sam Bankman-Fried, the chief executive of FTX, provided a lifeline to a failing digital assets business for the second time in as many weeks, therefore bolstering the faltering $900 billion cryptocurrency market.
After that, in an interview with Forbes, the SEC Commissioner Hester Peirce remarked that cryptocurrency “does not have a bailout mechanism,” and that this lack of a bailout mechanism is often seen as one of the marketplace’s virtues.
Peirce, known as ‘Crypto Mom’ for her pro-industry position on regulation, added that when the market gets harsher, it will be simpler to see who is constructing something that will survive and what won’t.