As a seasoned crypto investor with experience in navigating the volatile market, I’m closely monitoring the situation between Binance and FlowBank’s bankruptcy. While it’s disheartening to see yet another financial institution face insolvency, I find Richard Teng’s reassurance that “very little” assets were held at FlowBank on Binance’s behalf comforting.
Richard Teng, the head of Binance, is keeping open lines of communication with their clients following the bankruptcy of FlowBank, which held collateral for Binance’s traders.
As a cryptocurrency market analyst, I’ve observed that Binance, the well-known digital asset exchange, appears unfazed by FlowBank’s bankruptcy declaration made public on June 13th by Swiss regulators. According to the announcement, FlowBank had allegedly breached their minimum capital requirements “significantly and seriously.”
In a Bloomberg interview, Binance CEO Richard Teng assured collaborative efforts with clients over the bankruptcy situation, emphasizing that only a minimal amount of assets were kept at FlowBank.
“There’s very little assets on FlowBank on the tripartite arrangement front.”
Richard Teng
Introduced in 2020, FlowBank emerged as a welcoming platform for businesses dealing with cryptocurrencies. Through a collaboration with Binance, the exchange’s customers could securely store their trading collateral at the bank instead of on the digital asset platform. Based in Geneva, this financial institution also established connections to TrueUSD stablecoin and crypto asset manager CoinShares.
On June 14th, TrueUSD announced that it had terminated its banking relationship with FlowBank back in April. The stablecoin project confirmed it holds no connection or risk to the now-bankrupt institution.
As a crypto investor, I can tell you that starting from April 2024, TUSD (TrueUSD) no longer maintains an active bank account or any reserve exposure with FlowBank. In simpler terms, FlowBank is no longer the financial institution that holds or manages TUSD’s reserves.
— TrueUSD (@tusdio) June 14, 2024
As a crypto investor, I’d rephrase it like this: In a recent blog post, I, CoinShares, stated that my relationship with the bank as a customer is insignificant, with deposits valued at roughly £100,000 or equivalently around $127,600. Furthermore, I hold almost 30% of FlowBank’s shares as of March 2022.
In May 2023, it became public knowledge that Binance was holding talks with certain institutional clients about enabling them to store their trading collateral in a bank account as part of efforts to minimize counterparty risk in the aftermath of FTX’s downfall. However, it is still undecided if FlowBank was selected for this specific task.
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2024-06-14 12:32