Poor Crypto Projects May Not Be Easily Saved by Bailout, CZ Says

WikiBit 2022-06-24 12:34

Binance CEO Changpeng Zhao (CZ) stated on Thursday that bailouts should be done conditionally, since some projects may not be worth saving owing to their poor performance during the crypto winter.

　　Without elaborating, the Binance CEO stated that not all companies are destined to be rescued, and he hinted that the present economic disaster that has impacted the crypto industry is simply a way to highlight the firms that lack concrete business plans. According to CZ, certain companies simply do not deserve a bailout because they have “no product-market fit, are badly managed, and are poorly operated.”

　　While the aforementioned inefficiencies are not the difficulties of many other faltering businesses, he claims that excessive spending is what is pushing the majority of them to the ground. Based on these factors, CZ concluded that these poorly managed companies did not deserve to be bailed out.

　　“In any industry, there are always more failed projects than successful ones. Hopefully, the failures are small, and the successes are large. But you get the idea. Bailouts here don't make sense. Dont perpetuate bad companies. Let them fail. Let other better projects take their place, and they will,”

　　Changpeng Zhao stated that its negotiations team is exploring bailouts for some companies that have approached it, but that the merits of the proposals will be thoroughly investigated. CZ's entire remark came in the wake of the latest round of bailouts for struggling crypto lenders in the market.

　　While FTX futures exchange has come to BlockFi's rescue with a $250 million revolving credit facility, Voyager Digital has also received a $200 million bailout fund from Alameda Ventures, a scenario that now appears to be widespread in today's digital currency ecosystem.

　　As a reminder, WikiBit is ready to help you search the qualifications and reputation of projects in a bid to protect you from hidden dangers in this risky industry!

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