Dogecoin’s Shibetoshi Nakamoto believes a potential crash of the crypto exchange Binance or the stablecoin-issuer Tether could severely destabilize the entire industry.
He also advised people to do appropriate research and understand the digital asset’s sector specifics before entering it.
The Co-Creator of the memecoin Dogecoin – Billy Markus (better known as Shibetoshi Nakamoto) – thinks if either Binance or Tether goes down, this could be “pretty much game over.”
The American software engineer also outlined that an increasing number of people have realized that too much centralization is a “big weakness.”
The former CEO of Twitter – Jack Dorsey – was among the individuals to agree with Nakamoto’s assumption. He said such a potential meltdown will undoubtedly be “game over for the games.”
Still, DOGE’s creator believes the potential adverse event will not mean “crypto dies” but trigger a “big mega mondo market crash.”
Almost every disruption in the past, including the recent fiasco with FTX, has prompted severe market declines and panic among crypto participants. The uncertainty has also caused critics to proclaim bitcoin “dead.”
Despite “dying” over 460 times, the primary cryptocurrency is still around and keeps expanding its presence across the globe. It has become legal tender in distressed economies like El Salvador and the Central African Republic, while numerous investors view the asset as a hedge against inflation because of its limited supply.
Some market participants expected the FTX crisis to cause a domino effect and drag other exchanges into the mud.
The largest cryptocurrency platform – Binance – assured its balance sheet is stable and even topped up its Secure Asset Fund for Users (SAFU) to $1 billion to protect customers in case of emergency.
In addition, the company introduced an industry recovery fund that could help struggling projects during turbulent times.
“To reduce further cascading negative effects of FTX, Binance is forming an industry recovery fund to help projects who are otherwise strong, but in a liquidity crisis. More details to come soon. In the meantime, please contact Binance Labs if you think you qualify,” CEO Zhao stated.