Crypto investors are looking for someone to blame for a crashing market that has already shed one-fifth of its total market capitalization since the start of the year — and they have Binance squarely in their social media crosshairs.
However, the world’s largest crypto exchange is firing back, denying rumors that it’s sending legal letters to silence critics.
“Winning is the best response to FUD,” founder Changpeng Zhao (CZ) wrote today. “Binance saw net inflow for ALL 1 day, 7 day and 1 month periods, to the tune of $ billions. Some possible FUD sponsors saw the opposite,” he laughed.
Amid the bearish knock-on effects from Binance’s role in a massive liquidation event on October 10, sentiment against the company has continued to deteriorate.
Goodwill gestures by the exchange have failed to calm complaints, and some traders with losses even threatened Binance with legal action.
Recently, critics have been broadcasting ragebait and screenshots of alleged cease-and-desist letters about October 10–11, from Binance, or even an alleged direct message threat from CZ.
Schrödinger’s letters from Binance lawyers
Whether Binance’s law firms have sent cease-and-desist letters this week is a classic case of he said, she said. Thousands of people seem either entirely convinced or entirely unpersuaded.
Today, for example, CZ denied sending not only that direct message but also any legal letters over insolvency allegations.
In contrast, a trader with massive losses from October 10-11 insists that Binance group attorneys “are leveraging UAE law to warn me to delete my posts” and have threatened him with a lawsuit.
Elsewhere, a social post with over a million impressions claimed that Binance was suffering insolvency. Later, that same person claimed Binance mailed him a cease-and-desist letter about that insolvency claim — which again earned almost a million impressions.
However, Binance’s help desk called that letter a forgery, and Binance co-founder Yi He reiterated that correction.
Examples of allegations that Binance actually sent a cease and desist letter are replete on social media, but whether or not the company actually sent them is dubious.
Read more: Lawsuits are piling up against Binance over Oct. 10
Binance has sued writers in the past
Complicating this matter, Binance has a true history of suing reporters, which makes CZ’s statement today that he has “no need to issue any letters” difficult to believe.
Indeed, Binance sued Forbes and two of its writers after their negative publicity, and CZ also sued Bloomberg’s Hong Kong publisher.
Moreover, CZ has extensive experience in the legal system and often crafts precisely worded answers to difficult questions.
Within the last week, for example, CZ claimed, “I don’t have personal investments in Aster, and Binance as a company is not involved.” Although that statement was technically true, CZ nonetheless had money invested in Aster via his family office, YZi Labs.
In other words, his statement was only true because of a technicality of the word “personal.”
So whether and to what extent the crypto industry can trust CZ’s claim today that he has “no need to issue any letters” is a matter of public debate.
Despite Binance’s denials of cease-and-desist letters this week, moreover, some critics remain convinced that real letters might still be out there.
Protos has reached out to Binance for comment but didn’t receive an immediate response. We will update this story if we receive a reply.
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