As a result of the SEC’s pressure on Binance and the lawsuits it filed, Binance’s insurance fund lost 11 percent in value.
The crypto industry has been going through some tough times in recent weeks. The US Securities and Exchange Commission (SEC) shook the agenda with the lawsuits it filed against the two largest cryptocurrency exchanges. The litigation of crypto exchanges and the collapse of altcoins also negatively affected the course of the industry.
According to the news of The Wall Street Journal, as a result of the pressure and lawsuits brought by the SEC, the insurance savings that Binance kept as a bad day fund lost 11 percent in value.
Binance’s Insurance Fund Is Losing Value!
Launched as the world’s largest crypto exchange, Binance launched an insurance fund in 2018. This fund was created to secure the assets of platform users.
Assets, which are reflected as emergency funds, also serve to prevent disruptions in possible withdrawal and deposit transactions. The fund, which provides functionality in many areas, has been endangered due to the troublesome processes experienced recently.
According to the news of The Wall Street Journal, the insurance fund created by Binance to use in emergencies and to protect customer assets fell 11 percent. Before the SEC cracked down on crypto and sued Binance, this fund was worth $950 million. With the Binance lawsuit filed by the SEC, the fund has dropped to 840 million.
Binance CEO CZ mentioned that this fund has been strengthened in order to relieve stress on customers and be used for possible bad situations. CZ reported that after FTX’s bankruptcy, the insurance fund was increased to $ 1 billion.
But the devastation wrought by the SEC lawsuit has evaporated nearly $110 million from Binance’s insurance fund.
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