It is therefore not a rumor: BNB must in no case yield the bar of $212, and the CEO of Binance, CZ, finds himself on the front line to defend it. The slightest deviation could precipitate an imminent liquidation, with unpredictable consequences for the crypto market.
Tension rises around the $212 mark and emerging issues
Since this weekend, a rumor swelled on twitter: Binance, one of the most influential exchange platforms in the crypto ecosystem, could find itself in danger of liquidation. However, the truth goes far beyond this mere speculation.
It is clear that the value of BNB failed to break through the $212 mark. The reason is complex. Indeed, it would seem that Binance has taken out a BNB-backed loan, with a liquidation condition as soon as the price reaches this fateful mark. Even though this threshold had been adjusted to $220 following the introduction of margin in June, this reality put CZ and his team in a difficult position.
Strategies Unveiled
The spotlight is on CZ, who recently broke his silence. Crypto watchers wonder if Binance’s future hangs on this sticky situation.
Of the sources insinuate that CZ has taken action to swap BTC for TUSD, while simultaneously buying BNB, in an effort to prevent the crypto from plunging below $212. These movements evoke the game in which Sam Bankman Fried was engaged in keeping the FTX token, the FTT, afloat.
These maneuvers are reminiscent of the trick game Sam Bankman-Fried played to keep FTX’s FTT afloat. A move that can only capture the attention of a crypto community that still remembers the disastrous consequences of such actions, as paid for by the defunct struggling platform, FTX.
The debate gained viral momentum on Twitter, prompting insightful comments from crypto experts. Marty highlights that the health rate of BNB was supported in June to the tune of $60 million, thus influencing the liquidation threshold set at $212.
CZ comes out of his silence
CZ’s response was quick. While questioning the famous “magic number” of $212, the Binance CEO supports his position by pointing out the fluid and changing nature of the price of BNB.
“And where does the magic number of $212 come from? BNB, the price is determined by the market. A buyback of $30 million is less than 4% of a single day’s volume.”
In sum, the epic of Binance and BNB transcends the simple notion of liquidation threshold. It reflects a complex web of issues faced by exchanges in the crypto landscape. The balance between internal and external factors plays a major role in maintaining stability and trust.
The saga continues, as the unfavorable news continues to pile up for the platform which must manage the situation of Checkout.com, a credit card processing company, having recently terminated its contract.
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