The CEO of crypto exchange Binance, Zhang Ping (CZ) Zhao, alarmed traders after learning about the shameful phenomenon of trading instability on other cryptocurrency exchanges.
The instability in cryptocurrency trading is associated with a trading event where an investor's buy or sell order gets stuck and moves down the list, allowing newer trading orders to pass, Cowen Telegraph reported.
While CZ's concerns were not explicitly targeting any particular exchange, the crypto community on Twitter assumed it was a covert attack on FTX, a cryptocurrency exchange led by Sam Bankman Fried.
In response to the community's reaction that instability is a well-known and accepted condition, CZ added: You all knew and said nothing. And we need to fight the bad guys.
CZ also contacted important traders on Binance, who allegedly confirmed knowledge of illegal trading activities. The indirect allegation against FTX coincides perfectly with the timeline in which the FDIC issued a cease-and-desist order for the exchange and four other cryptocurrency companies.
According to the FDIC, FTXUS, Smart Assets, FDIC Crypto, CryptoNews, and CryptoSec, they allegedly misled investors by claiming that their products were FDIC insured.
In response to the matter, FTXUS President Brett Harrison deleted a tweet containing the allegations, which were opposed by the foundation. However, the cryptocurrency community on Twitter was quick to point out several other cases when Harrison falsely claimed to have FDIC insurance.
In an effort to mitigate the free fall, Sam Bankman-Fried revealed his intention to work with the FDIC in the future while emphasizing the fact that FTXUS is not FDIC insured.
Parallel to the aforementioned developments, FTX reportedly started blocking accounts that sent cryptocurrency through zk.money, a private Layer 2 chain offered by Aztec Network on Ethereum.
In response, Sam Bankman supported FTX's decision to monitor the accounts citing anti-money laundering (AML) compliance. But he denied the allegations, adding that this did not mean that any accounts had been frozen.
