Binance increases its SAFU fund after first deal with FTX

Binance increases its Secure Asset Fund for Users (SAFU) to $1 billion. The current volatility of BNB and the digital asset market itself were major factors in this decision.

A few hours ago, Changpeng Zhao (CZ), CEO of Binance, broke the news of the decision to increase the Secure Asset Fund for Users (SAFU).. According to the tweet from CZ’s account, Binance will inject assets until the value of the fund reaches 1 billion dollars. The last time Binance decided to increase its fund to $1 billion in assets was in the February of the same year.

SAFU is a fund created by Binance in July 2018 with the goal of protecting its customers and their assets.. Should a crash drastically affect the economy of the exchange or its parts, Binance would cover its users’ withdrawals with these funds. When the fund was established, Binance allocated a percentage of its fees to grow the fund to a considerable levelnecessary to protect the interests of its users.

It may seem strange that Binance wants to raise its fund to $1 billion if it has reached this figure before, but this is the main reason why Binance wants to match it again. The SAFU fund is composed of digital assets that fluctuate, losing and gaining value.. Since February, the market in general has been on a downward trend, which has depreciated the overall value of the fund. To adjust for recent market fluctuations, Binance will include the assets needed to return to this $1 billion threshold.

According to the latest announcement, The SAFU consists of $700 million in tokens from the Binance BNB and Binance USD (BUSD) ecosystem.. The other The remaining $300 million consists entirely of BTC tokens..

Binance made this decision just hours after revealing its intentions to to acquire the FTX exchange. The news was announced mid-afternoon yesterday by the CEOs of both platforms: it appears that FTX collapsed due to an alleged lack of liquidity within the platform. Binance has offered to take over the platform in its entirety to ensure that users of the platform are not affected. This news has affected the entire cryptocurrency ecosystem with widespread declines.

Some of the most notable losses were:

• Bitcoin (BTC) fell by 10% in the last 24 hours up to $17,750 current.
• Ethereum (ETH) collapsed by 17% in the last 24 hours at $1,227.
• Binance’s own token, the BNBalso saw a decline in 6,3% which left it at the $300.

Continue reading the Coinbase’s continuing problems with German regulatorscould be interesting.