'Avoid Exchanges That Need to Raise Fund to Survive,' Binance CEO

Following the recurring cases of crypto platforms freezing users’ accounts and restricting them from active access to their funds, the CEO of the Binance exchange, Changpeng Zhao, has counseled the crypto community.

CEO Zhao said, in a tweet on July 21, “Choose exchanges wisely. Avoid exchanges that need to raise money to survive.” He commented while reacting to the news that Zipmex, a Singapore-based crypto exchange, had halted crypto withdrawals for its customers “until further notice.”

Twitter user @ksa_crypto2030 challenged his opinion, saying, “What’s your assurance your exchange will not bite the dust?” and CEO Zhao reassured that “Nothing is risk-free. We at least run a profitable/ sustainable business.” Adding on, Binance is the largest cryptocurrency exchange, with nearly $20 billion in trading volume in the last 24 hours.

Speaking of Zipmex’s move, the platform joined the league of crypto companies fighting for survival. In its press release on July 20, 2022, the exchange claimed the decision was “due to a combination of circumstances beyond” their control, pinning the blame on volatile market conditions. The press release read:

“[Due to] the resulting financial difficulties of our key business partners to maintain the integrity of our platform, we would be pausing withdrawals until further notice.”

Although Zipmex’s tagline on Twitter claimed they were a “leading digital asset exchange providing high liquidity and insurance” for users’ assets. But the recent development has proved the statement false.

The Celsius Network, however, was reportedly the first crypto platform to restrict customers from their funds in recent times. The company has been implicated in several damning reports on how it architected its downfall.