Binance took just 5 minutes to get over loss of $1.6B in LUNA |

Binance took just 5 minutes to get over loss of $1.6B in LUNA |

Binance, the world’s largest crypto exchange by volume and one of the most popular trading platforms overall has lost an estimated $1.6 billion in just 5 minutes due to a security breach that hackers exploited on July 4th. Though not as significant as some other cases, this benchmark will be used for years to come when others consider how much money they need in their reserves.

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The “binance fiat deposit failed” is a problem that has been occurring since Binance announced the launch of their USDT trading pairs. The company took just 5 minutes to get over the loss of $1.6 billion in LUNA tokens.

Binance took just 5 minutes to get over loss of $1.6B in LUNA |

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Binance CEO Changpeng ‘CZ’ Zhao has made the internal leadership team’s communication records public amid the Terra dispute.

The documents show CZ and Binance director of product Mayur Kamat discussing what to do with Binance’s 15,000,000 LUNA, which were originally valued $1.6 billion. The coins, which were part of the company’s original $3 million investment in Terra, are now only worth $2,700.

sacrificing billions

CZ remarked in a Twitter thread dated May 16:

“Binance will let this go and request that the Terra project team reimburse retail consumers first, and Binance second, if at all.”

The publication of the conversation records demonstrates that this decision was made in less than five minutes. Kamat wrote to CZ in a text message:

Binance took just 5 minutes to get over loss of $1.6B in LUNA |LinkedIn (source)

Users come first.

The ability to decide to forego billions of dollars to put its Users come first. is something extremely alien to traditional capital markets. A CEO has a fiduciary duty to make decisions that best serve the company, not necessarily its customers.

Despite the fact that the interests of both parties are often aligned, Binance could have saved hundreds of millions of dollars by selling its LUNA tokens during the crisis. As a result of not doing so, Terra LUNA will delete 15,000,000 LUNA coins from the new LUNA fork, perhaps making the issue worse. In a statement on the events, Kamat says,

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“You will notice signals that indicate you are employed by an exceptional organization. It frequently manifests itself in difficult judgments. That said, I’ve never worked anywhere where they were produced so swiftly.

Even vast sums of money are fungible. However, consumer trust is considerably more difficult to earn and much easier to lose. Prioritize the crucial and do your utmost to safeguard the users.”

According to Kamat’s rationale, the choice to let billions of dollars go was in Binance’s best long-term interests. Users may choose a corporation that is believed to safeguard its users at a significant expense to itself.

Was this merely a publicity stunt?

However, even if Binance had wanted to, it’s likely that it couldn’t have done anything about the $1.6 billion LUNA coins. This might all be a public relations stunt, with the screenshots being released as part of a larger push to boost the company’s favorable image. By design, obtaining private keys for exchange-held wallets is notoriously difficult. Embezzlement and fraud are often prevented by using multi-sig wallets or dividing private keys among key leadership members.

LUNA dropped 98 percent to barely $1 per coin in less than 48 hours starting on May 9. Do Kwon and the LFG team started selling tens of thousands of Bitcoin to reestablish the peg while UST was trading around From May 9, it took less than 48 hours for LUNA to crash 98% down to just $1 per coin. At this point, UST was trading around $0.21, and Do Kwon and the LFG team began selling tens of thousands of Bitcoin to restore the peg. By May 11, UST had reached $0.79, and there were signs of a recovery. However, the algorithmic relationship between UST and LUNA caused the latter to crash down to $0.00000136 by May 13..21. UST had hit From May 9, it took less than 48 hours for LUNA to crash 98% down to just $1 per coin. At this point, UST was trading around $0.21, and Do Kwon and the LFG team began selling tens of thousands of Bitcoin to restore the peg. By May 11, UST had reached $0.79, and there were signs of a recovery. However, the algorithmic relationship between UST and LUNA caused the latter to crash down to $0.00000136 by May 13..79 on May 11 and was showing signs of recovery. The algorithmic link between UST and LUNA, on the other hand, led the latter to plummet to From May 9, it took less than 48 hours for LUNA to crash 98% down to just $1 per coin. At this point, UST was trading around $0.21, and Do Kwon and the LFG team began selling tens of thousands of Bitcoin to restore the peg. By May 11, UST had reached $0.79, and there were signs of a recovery. However, the algorithmic relationship between UST and LUNA caused the latter to crash down to $0.00000136 by May 13..00000136 on May 13th.

Binance’s LUNA tokens were only valued $20.40 at the time. On May 16, CZ sent out a tweet stating that Binance will not be relocating or selling its 15 million LUNA. As a result, unless Binance elected not to sell the LUNA coins before May 10, the coins were worthless.

Will LUNC be listed on Binance?

Whatever the rationale for not selling the tokens, it’s still a great gesture to the Terra community that one of the early investors is prepared to sacrifice any airdrop in order to avoid diluting the ecosystem. However, another idea suggests that Binance is opposed to the new chain and may not even include it after its launch. When the fork happens on May 27, two chains will be generated. The present chain will be renamed $LUNC, while the new chain will be called $LUNA. Binance will either include both currencies or opt out of the Terra system completely.

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