- Kevin O’Leary has roped Binance into the infamous FTX scandal, claiming that the exchange deliberately caused the collapse.
- He also called for increased regulation in the industry, hinting that, at the end of the day, only proper laws will save the market.
- Fear and doubts from investors still loom over the market as the FTX hearing proceeds.
Sam Bankman-Fried, Alameda Capital, and now Binance, the blame game, continue for FTX’s woes which put the market multiple steps backwards.
Canadian businessman and co-executive producer of the reality show Shark Tank, Kevin O’Leary, has blamed Binance for the collapse of fellow exchange FTX despite its effort to save FTX at the early stages of the saga.
Speaking at the US Senate in the FTX hearing titled “Why the FTX Bubble Burst and the Harm to Consumers,” O’Leary used strong words to describe Binance’s involvement in the FTX debacle. He claimed that Binance caused it on purpose and is now a “massive, unregulated monopoly now.”
Explaining his views, he stated that the CEO of Binance, Changpeng Zhao, disclosed that he would begin to sell FTX native tokens on Binance, a move that led to the bankruptcy filing a few days later.
O’Leary called for more regulations around the industry to avoid a repeat of the ugly incident and to gain investor confidence. According to him, LedgerX, an FTX-owned derivatives trading platform, was the only “entity that didn’t go to zero” due to the Commodity Futures Trading Commission’s regulation.
Senator Cynthia Lummis toed the path of O’Leary during the session pushing for more regulations in the market.
“It is time to separate digital assets from corrupt organizations. FTX is good old-fashioned fraud. Mismanagement, failure of people, and inadequate controls are what’s on trial. We need to regulate this business and lay digital assets on top of our existing financial framework.”
Binance new monopoly
Following the collapse of FTX, a major competition of Binance, it is now perceived as having an unhealthy monopoly in the market. However, Binance has been the leading crypto exchange for many years. O’Leary is not alone in this, as many users feel Binance is now heading to a point where it cannot be matched by its competition and can dictate what happens in the industry.
A Binance monopoly is considered by analysts as unhealthy for the industry, just as O’Leary pointed out, as it could lead to centralization. Last week, users withdrew over $8 billion from Binance though the CEO described it as “business as usual.” Binance currently dominates the market with a 24-hour trading volume of over $12 billion.