Binance Weighs Rescue Plan
After setting off the fuse for a bank run that resulted in the complete collapse of FTX the previous week, "CZ" now appears to have his sights set on playing the role of white knight for the cryptocurrency industry.

According to a story that was published on Thursday by CoinDesk, citing a source familiar with the subject, Binance's U.S. subsidiary is considering resuming its attempt to acquire the insolvent lending firm Voyager Digital. The market-dominating giant controlled by Changpeng Zhao had already submitted a bid in September, but it was defeated by FTX in the auction. On the other hand, Voyager stated that it reopened bidding after FTX submitted its petition for Chapter 11 bankruptcy on November 11. According to recent reports, Wave Financial is getting ready to place a proposal with Binance. US, which had already been defeated by FTX in an earlier auction.

According to a story published by Blockworks on Wednesday, which cited unnamed sources, Zhao is said to have indicated interest in purchasing the loan assets that are currently listed on Genesis' balance sheet. On Wednesday, Genesis Trading struck a another blow to the already devastated cryptocurrency market by announcing that its lending arm, Genesis Global Capital, has temporarily suspended redemptions. This move came after Genesis Trading revealed that it had temporarily paused lending. Genesis is the most prominent lender in the industry and is controlled by Digital Currency Group, the industry's parent firm. Following yesterday's news, there has been a ripple effect throughout the industry due to the company's extensive engagement with other significant players throughout the sector. These efforts have sparked fears of future contagion. Genesis was also hard hit over the summer as Three Arrows Capital collapsed after taking a nine-figure hit on Terra's downfall; court filings at the time revealed that Genesis had loaned $2.4 billion to the now-defunct hedge fund. During the summer, Genesis was also hard hit as Three Arrows Capital collapsed after taking a nine-figure hit on Terra's downfall. In the current litigation between the two parties, it is demanding $1.2 billion from Three Arrows.

Given that FTX and Sam Bankman-Fried both attempted to play the same role in the aftermath of the Three Arrows liquidity issue, the alleged efforts that Binance is making to play the position of white knight in the sector come across as something of an ironic twist. In the wake of the failure of Three Arrows and a string of lenders, FTX swooped in to acquire Voyager and BlockFi, two other companies that are reportedly on the verge of going bankrupt as a result of the most recent crisis to hit the industry. Sam Bankman-Fried, who served as the former CEO of FTX and famously told Forbes that he believed many other cryptocurrency firms could be "secretly insolvent" as the dominoes began to fall in June, stated that his company could allocate up to $2 billion to bail out other firms. He made this statement after the dominoes began to fall in June.

How We Can Move Forward
Zhao has expressed confidence in a brighter future on multiple occasions over the past few days. This is despite the fact that the industry as a whole is still reeling from the effects of the explosion at FTX. On Monday, he confirmed that Vitalik Buterin, the creator of Ethereum, was working on a "proof-of-reserves" protocol for cryptocurrency entities, and that Binance was going to act as the first tester for the protocol. Today, he forecast that the FTX incident "will set us back a bit, but then the industry will become healthier" in an interview with CNBC's Squawk Box program. He also played down the seriousness of the implosion by pointing out that FTX held approximately 3 to 5% of the global market share until the previous week, with the majority of its trading volume coming from wealthy institutional investors. He said this to demonstrate that the implosion was not as bad as it seemed. "[3 to 5% is] still a decent number, quite a few users ended up getting hurt. However, it is not fifty percent or something comparable to that," he stated. It has come to light that several of the top funds in the industry, including Galois Capital, Multicoin Capital, and Ikigai, had significant portions of their portfolios stuck on FTX. It is widely believed that other funds and projects could be suffering in silence.

The failure of FTX has been compared to the crash of Mt. Gox in 2014, which was once the leading cryptocurrency exchange and was responsible for approximately 70 percent of all Bitcoin transactions before it was compromised by a hacker. After years of delays due to a protracted legal battle, users who suffered financial losses as a result of the incident are still waiting for compensation. It is feared that victims of FTX will experience a wait for their assets comparable to the one described above, if they receive anything at all. Due to the fact that FTX reportedly loaned almost $10 billion worth of customer deposits to Bankman-Fried's Alameda Research as the trading firm dealt with its own losses following the failure of Terra, the funds have effectively disappeared. And this is bad news for FTX users who were caught in the bank run last week but were unable to get out in time.