Binance denies participation in Terra's 2019 funding round
Binance CEO Changpeng Zhao replied on Twitter to a journalist who had insinuated the exchange for siding with Terra
By Shashank Bhardwaj
Image: Antonio Masiello/Getty Images
Binance CEO Changpeng Zhao addressed the claims of a journalist who tweeted that Binance has invested in Terra’s LUNA in 2019 and 2021. CZ denied the claims and showed dissatisfaction with how Terra handled its stablecoin debacle. He also said that Binance was ready to help Terra revive itself, provided the platform remained more transparent.
The deleted tweet by Larry Cermak, a journalist at The Block, said, “Easy to see why CZ is tweeting so passionately about LUNA. Binance led Terra’s seed round in 2019 and Terra’s 2021 round. In the last one that ended just like six months ago, they invested $300M with a 4y vest and 1y cliff (same amount as Jump).”
Binance's CEO responded to the tweet on Sunday, denying the claims, “Binance did not participate in the 2nd round of Luna’s fundraising, nor did we acquire any UST. Binance Labs invested $3m in Terra (the layer 0 blockchain) in 2018. UST came much later after our initial investment.”
Zhao has laid ample criticism about how the Terra platform handled the demise of its stablecoin TerraUSD post the crash this weekend. Earlier, he had tweeted, “These past weeks have proven to be a watershed moment for the crypto industry. We have witnessed the rapid decline of a major project, which sent ripples across the industry, but also a newfound resiliency in the market that did not exist during the last market downswing.”
Cermak claimed that Binance was financially invested in the Terra project, and the crash and the project’s failure had caused them losses. He also said that the criticisms from the Binance CEO were motivated by these investments. Zhao said that though the claims were false, even if Binance had invested in Terra during the misstated time, the project’s failure wouldn’t have been an issue. Binance has been investing in several projects, including those of rival blockchains, the CEO had previously said.
Zhao had been vocal about being open to helping Terra revive from the crash but wanted to see real value in the industry and expected more transparency from the Terra platform. He also spoke to Do Kwon, Terra’s founder, about the new proposal to revive the dying Terra ecosystem and said he wasn’t sure if the proposal would work.
Zhao said, “I would like to see more transparency from them. Much more! Including specific on-chain transactions (txids) of all the funds. Relying on 3rd party analysis is not sufficient or accurate. This is the first thing that should have happened.”
LUNA and TerraUSD have been halted on many exchanges, including Binance.
The writer is the founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash