Terra’s ship sailed gallantly but has now collapsed following a series of algorithm attacks that made the blockchain network’s native token LUNA plunge to what many see as an irredeemable level.
With so many experts wondering what is going on, Binance’s Chief Executive Officer, Changpeng Zhao has come out to clarify the investments the trading platform has in the Terra ecosystem in what appears as a response to false claims going around on Twitter.
According to CZ, as he is fondly called, Binance invested $3 million in Terra back in 2018 when the project was labeled a Layer 0 blockchain, and the trading firm did not invest in the protocol in its second financing round. CZ said Binance did not also make any acquisition of UST, the network’s algorithmic stablecoin that is no longer maintaining a peg with the US Dollar.
“I need to address falsehoods circulating in crypto twitter,” Zhao said in the Twitter thread, “Binance did not participate in the 2nd round of Luna’s fund raising nor did we acquire any UST. Binance Labs invested $3m USD in Terra (the layer 0 blockchain) in 2018. UST came much later after our initial investment.”
The CEO noted that the exchange has made hundreds of investments over the years and while some turned out very successful, there are a number of others who end up by the wayside.
Changpeng Zhao also lends his voice to the Terra ecosystem’s validator’s proposal to fork the blockchain and create Terra2 by taking a snapshot of LUNA token holders’ balances prior to the network’s attack and eventual price slump. To CZ, “Minting, forking, don’t create value,” but burning and token buyback do.
At the moment, there are approximately 6.5 trillion LUNA tokens in circulation, and burning or buyback, according to CZ can be very expensive. While CZ has promised further support beyond the relisting of LUNA/USDT spot trading shortly after halting the services, the CEO however, demanded transparency and accountability.
Image source: Shutterstock