Binance has taken action to safeguard the funds of its users as the cryptocurrency markets plummet. Significantly, 16,276 BTC, or around $1,010,975,540, was moved by Binance from one unidentified wallet to another. This wallet is allegedly connected to Binance’s Secure Asset Fund for Users (SAFU), an emergency fund established to safeguard user cash on the site.
The SAFU got its start in July 2018 when Binance started setting aside a portion of trading fees to create a financial safety net in case of emergencies. SAFU’s valuation by the end of January 2022 was an astounding $1 billion USD. Such a fund’s value can fluctuate, thus Binance has stated that these assets would be converted to USDC, a stablecoin that is correlated with the US dollar, in an effort to reduce risk.
When Changpeng Zhao (CZ), the former CEO of Binance, tweeted, “Funds are safe,” during an unplanned maintenance window, the idea of SAFU gained traction. Within the cryptocurrency ecosystem, the statement became a consoling catchphrase that eventually became the viral meme “Funds are SAFU.”
Binance’s coin
Examining the chart of Binance Coin (BNB), we observe a market struggling with uncertainty. Following the latest decline, BNB encountered resistance at $560. Overcoming this barrier would be crucial for Binance Coin to restore its momentum in the event of a change in market sentiment and a rebound.
In terms of growth options, Binance Coin may test the resistance levels once more if it is able to stabilise after the drop. But for the time being, it seems like the market is playing it safe, and Binance’s choice to protect its USDC holdings may have been influenced by a pessimistic market outlook.
