So, Binance is planning to take some of that SAFU fund, which is around $1 billion, and turn it into Bitcoin. With the market taking a big hit lately, I think this move is meant to reassure Bitcoin investors and keep everyone from panicking. Plus, it’s a smart move for Binance since it could help push Bitcoin's price back up.
I’m not totally sure about this news, but if you check it out, you can find the txid for the transaction in the second link I shared below.
https://cointelegraph.com/news/binance-buys-dip-first-100m-bitcoin-safu
https://www.blockchain.com/en/explorer/transactions/btc/b1231fa059a73d7408a0f40fdc41f603d16f520609a4890ee33763a294385490
They’re also planning to convert the rest of the stablecoin into Bitcoin in the next 27 days.
Binance is the reason of market crash in 10 October and its consequence has lasted till now. I read complaints that many Binance users did not happy with their losses in the crash and what Binance compensated them later. I have no way to verify whether what they said about Binance compensation, in their opinion is unfair, is true but it is one of reference. Rather than using SAFU fund to buy Bitcoin dips, Binance should treat their users better as their exchange reputation has been harmed a lot since then.
In another view on this dip purchase from Binance, it can help people in the market calm down a little bit as they see diamond hands actually took action and caught the dip. The purchase increases demand on Bitcoin during latest chaotic weeks, and can trigger other people to accumulate bitcoins in bearish time.
Binance is not in any way acting to protect investors confidence in the Bitcoin market, but rather binance taking advantage of the recent Bitcoin price dip to bag up more Bitcoin to their portfolio, this is what most big cryptocurrency companies with large liqudities in stable coins so each time of the bear market, they always buy the dip and wait.
Business is, fortunately or not, goes only for one thing, be an exchange or the likes of Saylors-like companies - profit.
So what you are saying is 100% true.
Such a move is a sign of encouragement to those who have lost their cool as investors; they could be able to draw virtue or strength from the fact that Binance invested in Bitcoin at this moment in time when it seems the market is collapsing, but the truth is, investing now at this point in time would yield fruitful results in the long run and only diamond hands could understand this and take advantage of it to make good profit in the end when there is a price recovery.
Do not mind what people are saying, it is a lie if they said Binance is the cause of the crash in October. Market can abruptly move in the up or down direction in crypto market. Even in stock and commodity market, this can happen. The volatility also occured on other exchanges.
I did not know when the USD1 bug occured if that is what you are taking about, but that can not be the reason for the crash.
Yes, this is what is happening. The $1 billion might become $10 billion in the next 10 to 15 years.
Despite Binance controversy surrounding the recent market crash, I think Binance decision to choose Bitcoin as its SAFU fund is the right one. They stand to profit from Bitcoin's significant appreciation, and this will increase their emergency fund allocation to protect their users. The Secure Asset Fund for Users, or SAFU in short, is Binance strategy to protect its users assets. Its purpose is to protect user assets in the event of an unforeseen event. I believe it is primarily for internal issues (system errors or hacks), as external user errors are not protected. Therefore, their goal is highly advantageous in terms of profit and benefit (gaining user trust).
Policy uncertainties, geopolitical risks, attack on the US Feds independence, etc is leading to the weakening of the US dollars. Companies and Central Banks are massively diversify thier reserve currency. They might not announce these moves for the fear of punishment from the US government, but dedollarization process is ongoing.
The US dollar in global foreign exchange reserves was 71.19% at the beginning of 1999 but it is now 57.08% in the second quarter of last year. Binance might be simple moving it's reserve from the dollars to Bitcoin.
https://www.aa.com.tr/en/economy/us-dollars-share-of-global-reserves-shrinks-amid-policy-uncertainty/3814225
Bitcoin is the biggest and safest cryptocurrency so Binance just did a right thing for their business. Adding Bitcoin to their SAFU fund as their preparation for the next bull market is their very intelligent strategy. Binance don't aim at short term speculation like newbies and inexperienced people in the market, and their bitcoin loading into their SAFU fund is truly for long term holding.
Their action lately is like a model for other people in the market who need to follow someone or entities like exchanges for their investment practice. Finding successful entities and follow their intelligent actions is one of wise strategy to save your time for achieving success.
Of course. The goal is more money. That's the ultimate goal. The decision wasn't strictly for the market, nor was it done because they're truly concerned of investors' confidence. That was a self-serving move.
And why is Binance using the fund that's supposed to be for the users? What will happen when there's an emergency for which the fund is precisely set aside? Why didn't they use their own company reserve? Or why didn't they sell some of their BNB shitcoin to boost Bitcoin?
There is nothing like Binance restoring customer confidence in Bitcoin because they don't own it, every investors have their selfish interests of making profit in the market, if they can manipulate the market to their sole advantage they won't consider anybody. They are taking advantage of the dip like any other moneybag that believes in Bitcoin recovery to stuff their bags, when Bitcoin skyrockets they will be in massive profit like any other smart investors. Generally buying massively and holding is good for the market as it creates scarcity, this is the only advantage that their accumulation will be beneficial to the market.
Fair point of view makes sense but i would rather call it a powermove more then boosting investors confidence. Buying big in a dip looks good for the exchange,
but also its a big investment to buy in cheap. Also this move supports BTC price and makes Binance look good during chaos. And the remaining stablecoins getting converted over 27 days is also smart,
spreads out the buying so they dont nuke the order books or cause wild price spikes.
Bitcoin has always been the lead and we can't expect to see an exchange like binance to go for something else than Bitcoin with their reserve, the most have been targeting a time like this for long before the invest because one of the common culture in which exchange do is to invest in the market when down and use their stable coins in doing so, we should only see it as a strategy for them to make more as they take advantage of The Fall against the rising when the time comes in its due season for them to sell and take profits.
No good job in any way to them because they are part of those who have been dumping bitcoin all this while and here we are, what there are doing currently is simply a marketing tactics to gain love and support from the bitcoin community and it's possibly working from what i am seeing..
I am not saying that it's wrong for a company to decide to sell their bitcoin at any time they wish, but think about this, they did not release any public announcement the time they sold millions of bitcoins alongside other exchanges, now they decid3 to buy back, they are releasing a public announcement, why didn't they quietly buy back same way they quietly dumped millions of bitcoin?
Yes, mate, I came to know about this this evening from a random telegram channel. And after some time, I read another piece of news that the strategy also bought more bitcoin for its net holding, which is quite bullish for all of us to make market sentiment bullish. Well, no doubt this is good and bullish news, but I was watching a video on a social platform where the influencer was talking about this prediction on Polymarket , and many are hating CZ for now. I was wondering why people are hating CZ as of now then I did some more research and came to know the reason behind this is, in recent days CZ was making big prediction on his X account where he used to say that we are going to enter a prebolic year and he also have promoted a lot of altcoins and reading his tweets people made big losses. I know it absoultly people mistake who did not do their research before making any action. But at the same time, CZ's mistake is that he is a well-known personality who have its good influence in the crypto space. So that was the reason people are hating him.
I was thinking that the recent buying that Bincnace did, which you also mentioned. Did they do it to get their reputation back? As what CZ has been doing has had a bad impact on binance although he is the X-CEO of this company now. But still, he is playing a leading role in the crypto space, and he is also holding a significant amount of bitcoin for now. This is my point of view on this. What do you think? CMIIW!
Is this the start of another buying frenzy? Or are we going down to sub 70K?
I would not be surprised if now was the best moment for buying more Bitcoin. Binance usually does not buy such large amounts unless they were sure the market is going into the green again.
The whole gold/silver phase seems to be over and everything is being put back into place.
Well, let's assume they bought it to boost customers confidence, how about if Bitcoin falls to $50k? That was the thought that ran through my head when I read it, I'm not saying that Bitcoin will not rise and that they will not make profit during the bull market when the price starts to surge again, but what I'm thinking is that, during this supposed bear season which most people are saying that it is not yet confirmed, but what if the price actually goes down to $50k? Do they still have more reserve to convert to Bitcoin so they can still buy the dip at $50k?
I'll say its too soon right now, it doesn't feel that low at the moment and they could have waited a bit more before they did this. If they bought right now, then it is not going to really matter on the long term when the price goes down a bit more.
However, this could be a DCA method as well, since they only used 10% of the entire fund and not the whole thing, which means they can keep using 100 million each time bitcoin price goes 5k lower, and do a DCA that way which makes them some money. I wish this type of news to be spread over to all corner of the globe so that those institutions who are still in plan about bitcoin reserve, may push their plans for more quicker action.
You've got a point here. Binance just demonstrated a classic buy-the-dip behavior like every big investor who is a long term player would. These big investors are not running charity to buy bitcoins at this time just to protect and increase their customers' confidence during this period. Yea, this their action has a way of bringing about renewed confidence, but fact still remains that the sole purpose isn't for the customers. Binance is just grabbing this opportunity to accumulate bitcoins.