The CEO of cryptocurrency exchange Binance, Changpeng ‘CZ’ Zhao, has raised concerns for traders after learning about the notorious phenomenon of trading jitter on other cryptocurrency exchanges.
Jitter in cryptocurrency trading refers to a trade event where an investor’s buy or sell order gets stuck and moves down the list, allowing the most recent trade orders to pass.
I just learned a new word, nervousness. In 1 particular trade, sometimes your orders will be stuck for a while and some other orders will come in front of you. Apparently, this happens often enough on this exchange that traders have coined a term for it, nervousness. (front)
– CZ Binance (@cz_binance) 19 August 2022
Although CZ’s concerns about nervousness didn’t explicitly target any particular exchange, the cryptocurrency community on Twitter thought it was a dig at FTX, a cryptocurrency exchange led by Sam Bankman-Fried. Responding to the community’s reaction suggesting “shaking” as a well-known and accepted situation, CZ added:
“All of you guys knew and didn’t say anything. We have to fight the bad players. “
CZ also reached out to VIP traders on Binance, who have confirmed that they are aware of the illicit trading activities. The indirect accusation against FTX perfectly coincides with the timeline in which the Federal Deposit Insurance Corporation (FDIC) issued the order to cease and desist the exchange and four other cryptocurrency companies.
According to the FDIC, FTX US, SmartAssets, FDICCrypto, Cryptonews and Cryptosec have misled investors by claiming that their products were insured by the FDIC. Reacting to the order, US FTX President Brett Harrison deleted a tweet making the claims opposed by the FDIC. However, Crypto Twitter was quick to point out numerous other instances where Harrison falsely claimed FDIC insurance.
– AG123 (@ AG123321GA) 19 August 2022
In an effort to cushion the free fall, SBF has revealed its intention to work with the FDIC in the future, reiterating the fact that “FTX US is not insured by the FDIC”.
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Parallel to the above developments, FTX reportedly began blocking accounts that sent cryptocurrencies via zk.money, a private tier 2 chain provided by Aztec Network on Ethereum.
Recently, FTX blocked a user account to which it sent coins @aztecnetwork is zkmoney. According to FTX, Aztec Connect – Aztec network / zk money has been identified as a mixing service, which is a high-risk activity prohibited by FTX.
– Wu Blockchain (@WuBlockchain) 19 August 2022
In response, SBF supported FTX’s decision to monitor the accounts citing anti-money laundering (AML) compliance. However, he refuted the claims by adding, “but that doesn’t mean no accounts have been frozen.”