Luna crash: Binance Founder, Changpeng Zhao, Says He is Now Poor After Losing $1.6bn
- The crash of TerraUSD and Luna has left many investors poorer amongst whom is Binance founder, Changpend Zhao
- The billionaire said his platform invested about $1.6 billion in 15 million Luna tokens that crashed to $2,200
- Zhao has asked Luna owners to reimburse retail investors in order to restore confidence but said Binance has not been reimbursed
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The founder of Binance, the world’s biggest crypto exchange platform, Changpeng Zhao jocularly said on Tuesday, May 16, 2022, that he was now poor again after his platform’s investments in the cryptocurrency, Luna crashed to $2,200 from $1.6 billion a month ago.
Zhao said via a tweet that Binance held about 15 million Luna tokens. He stated Binance got the tokens in exchange for its $3 million investment in 2018 in the Terra network that Luna is based on. According to him, the Luna tokens were never sold.
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$1.6 billion investment crashes to $2,200
According to Business Insider, Binance holding in Luna was worth $1.6 billion in early April at the peak of its price. It traded at about $0.0001468 by Thursday, May 19, 2022.
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Luna's worth has fallen in the past two weeks.
The collapse of Luna began when its sister token, TerraUSD lost its ability to be pegged to the dollar, the two tokens are tied to each other.
When the price fell, investors ran to dump their holdings in a method akin to a bank run. TerraUSD's plunge, in turn, pulled down Luna's price.
The two tokens' free fall was estimated to have wiped out more than $50 billion in paper value, Insider reported on Sunday.
Still a billionaire despite Luna crash
The Binance billionaire founder asked the Terra team to reimburse its retail investors first as an example of how to protect users.
Despite his joke, 45-year-old Zhao is estimated by Bloomberg’s Billionaire Index to be worth about $14.8 billion as of Thursday, May 19, 2022.
Forbes says that most of Zhao’s wealth is from his 70 per cent stake in Binance.
Fortune reported in March that Binance's market value was estimated to be six times that of its nearest competitor, Coinbase. A report published by the financial-services consultancy Opimas said Binance took in about $14.6 billion in trading fees last year, MarketWatch reported.
Trouble hits Luna investors as stablecoin drops to zero in value
Recall that Legit.ng has reported that investors of Luna, the stablecoin that collapsed on Thursday, May 12, are crying as the value of the cryptocurrency equals nothing, trading at $0 on Friday, May 13, 2022.
Nigerian investors have bemoaned their luck as the value dropped to about N23 per LUNA, while it crashed on the international market.
As Bitcoin staged a comeback, surging above $30,000 irrespective of the ongoing troubles of stablecoins like TerraUSD that created panic in the market, investors of LUNA are in a hypertensive mood.
Source: Legit.ng
