Binance CEO Changpeng Zhao (CZ) has played a crucial role in the rebrand of Terra after the project’s collapse a few weeks ago.
Changpeng Zhao has revealed in a recent interview that he has never spoken to Do Kwon directly. Do Kwon is the CEO of Terraform Labs, the company behind the Terra blockchain and the UST stablecoin.
The Terra project crashed a few weeks ago, sending the LUNA token down by more than 99%. The UST stablecoin also lost its peg to the US Dollar, with the project losing over $60 billion within a few days.
However, Terra has been rebranded and Binance CEO Changpeng Zhao has played a crucial role in this latest development. He told Fortune magazine in a recent interview that he has never spoken to Do Kwon directly.
When asked about Binance’s support of the new Terra blockchain following its collapse, CZ said;
“I think overall, the whole situation is a disaster. It’s not good for anybody. It hurt a lot of users. A lot of value disappeared. I believe, fundamentally, there were design mistakes in the design of UST, Terra, etcetera. There was also operational mistakes. The [Terraform Labs] team didn’t respond quickly enough. They didn’t use their reserves to restore pegging when the peg was only a little bit deviated. And then only after it crashed [losing around] $80 billion, they tried to use the reserve of $3 billion trying to recover that. Of course, at that time, it doesn’t work.”
He added that Binance has a responsibility to its users to provide them with the necessary liquidity for each coin. CZ added that;
“We, as one of the largest exchanges, have a large number of users who have this coin. We still need to take care of those users. And the best way is actually to provide liquidity for the new coin, because the new one is going to replace the old one. The old one is going to become worthless. There’s no more utility to it. So we still need to provide continuity of the liquidity. For that reason, we still have to list it, even though it’s not a brand-new coin that we want to list. It’s not an ideal situation, but considering all the user interest in mind, we still have to list it.”
The Terra 2.0 blockchain has already gone live and its tokens are trading on some exchanges including Binance.