Binance CEO Warns FTX Fall Will Have “Cascading Effects”

Joshua Ramos
Binance’s CZ Speaks About Why France Is the Ideal Blockchain Hub
Source: CoinDesk

Speaking at a conference in India, the Financial Times has reported Binance CEO Changpeng Zhao’s warning that the fall of FTX will have “cascading effects.” A crisis could be on the horizon according to the CEO, with the falling crypto platform as the first domino.

The news of FTX’s tragic deterioration has been inescapable this week. Compounded by today’s revelation that the crypto trading platform has filed for bankruptcy, and seen the resignation of CEO Sam Bankman Fried. Changpeng Zhao has warned, however, that there will be effects.

Crypto Market Entering Crisis?

The Financial Times reported that the Binance executive has likened the current events in the crypto market to the 2008 financial crisis. Moreover, stating it was, “an accurate analogy” to what has taken place this week.

Zhao continued, “With FTX going down, we will see cascading effects. Especially for those close to the FTX ecosystem, they will be negatively affected.” Zhao has been the first to vocalize a very real concern for the industry. There are, after all, bound to be effects felt from one of the biggest crypto exchange platforms plummeting to near oblivion.

FTX Announces Agreement With Tron Allowing Holders to Swap Assets
Source: Cryptoslate

The Binance CEO is also not convinced that the current situation of FTX is an isolated incident. Zhao added, “A few other projects are going to be in similar situations. I think it will take a couple of weeks for most of them to come out.”

The downfall of FTX has been unlike anything the crypto market has seen before. Moreover, reports of misuse of customer assets, and Binance themselves backing out of a deal to acquire the now disgraced platform only continue the fracture of confidence.

Binance’s CZ Sheds His Insights on Decentralization and Centralization
Source: Bloomberg

Despite his grim prognosis, Zhao assured listeners that the fate of cryptocurrency is not decided by this. Conversely, Zhao stated, “the market will heal itself.”