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Free banking in the crypto world

All stablecoins and crypto exchanges will eventually be fully backed. The question is when.

 Xie Taojun, Ammu George, Liu Jingting
Published Fri, Nov 11, 2022 · 12:00 PM

THE crypto world has just gone through some turbulent days.

The value of FTT, a digital token, crashed after Changpeng Zhao (CZ), chief executive officer of Binance, tweeted about liquidating his company’s holdings of FTT, sending shockwaves across the cryptocurrency market. FTX, one of the world’s largest cryptocurrency exchanges and the issuer of FTT, soon suffered a liquidity crunch as the value of FTT plunged.

It is certainly not the first time that concerns around a crypto exchange’s asset holdings resulted in a market crash, but the impact this time seems to be larger.

CZ later tweeted that Binance will conduct a proof-of-reserves, an auditing procedure, to make it transpa…

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