A roughly double increase from 2020, the cryptosphere lost nearly $14 billion to fraud and hacking last year. With so many stories of people losing everything to these scams circulating online, investors are becoming increasingly concerned.
Describe SAFU. Binance’s Secure Asset Fund for Users project, or SAFU for short, collects a percentage of trading fees and invests them in a fund. If necessary, this fund will be used to reimburse users, for example in the event that the platform is compromised or if investors suffer financial losses as a result of a technological failure.
Public confidence will of course only remain strong if measures are taken to prevent, correct or compensate for these frauds. With its SAFU initiative, Binance, the largest cryptocurrency exchange in the world, has taken the initiative to defend the rights of its users and defend them against such tragic scams.
In 2018, SAFU was established as an emergency insurance fund. Since then, Binance pays a small portion of each transaction fee to the fund. The value of the SAFU fund in BNB, BUSD and BTC was found to exceed $1 billion earlier this year. Wallet addresses used to hold funds are also made publicly available, further enhancing the transparency of the initiative.
The Trend You can always count on the internet to take something admirable and turn it into a funny or ridiculous meme with little basis in reality. Binance CEO Changpeng Zhao tweeted “Funds are safe” during an unscheduled maintenance. A YouTube user by the name of Bizonacci made a movie titled “Funds are SAFU” which poked fun at the tweet.
The Need for SAFUE Even cryptocurrency heavyweights are vulnerable due to the increase in scam incidents. There is always a risk of data breaches, loss of private keys by the exchange, and other unforeseen circumstances. Here, SAFU comes into play. It works like an insurance policy that the company and users can rely on in case something like this happens. Public trust is crucial for a platform as big as Binance; if broken, users will be reluctant to open accounts. SAFU is an act of goodwill and a wise business decision to keep the public’s trust in Binance. It won’t be long for others to follow suit and launch their own SAFUs.
The phrase “funds are safe” is repeated throughout the video in Zhao’s voice under various ridiculous and terrible circumstances. In the three-minute film, Zhao is still heard declaring that the money is safe as we travel from the present to the end of the cosmos. The term SAFU became popular after the video, for some reason. Since then, the phrase “funds are safe” (SAFU) has been a slang term.
Storing the SAFU fund in cryptocurrencies is its only flaw. Therefore, it is vulnerable to market corrections. Bear markets, such as the one we are currently in, can have a significant impact on fund valuation. Apart from that, it is a terrific technique to ensure that client funds are SAFU i.e. safe and unscathed.
Summary of news:
- A Binance Investor Protection Initiative That Has Become Crypto Slang
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