Binance Tops Up Its Insurance Fund to $1 Billion

Leading crypto exchange Binance has topped up its users’ insurance fund dubbed Secure Asset Fund for Users (SAFU) to $1 billion equivalent again following recent price fluctuation in the crypto market, the company’s CEO Changpeng Zhao (CZ) announced via a tweet on Wednesday.

What is SAFU?

SAFU is an emergency insurance fund created by Binance in July 2018 to protect its users who experienced hacks or security breaches. When the fund was created, Binance allocated a percentage of trading fees in order to grow the fund to a sizable level to protect users.

The fund’s wallet comprises three different crypto assets including Binance Coin (BNB), Binance USD (BUSD), and Bitcoin (BTC). The fund’s value fluctuates based on the market.

Binance Tops Up SAFU to $1B

According to CZ, SAFU addresses now hold about $700 million in BUSD and BNB plus another $300 million in bitcoin, making a total of $1 billion.

Notably, Binance had announced in January that SAFU was worth $1 billion. However, due to the recent bear market, the exchange revealed that the fund’s value fell to $735 million. As a result, they had to top the SAFU balance back to $1 billion.

“We made a promise to our user base, along with the larger crypto ecosystem, that SAFU would always maintain a sizable level. We’ll continue to uphold that promise and continue to keep building,” Binance said in a statement.

Binance noted that retail investors place a lot of trust in centralized crypto exchanges. Hence, it is urging other centralized exchanges to follow its step by publicly publishing their insurance wallet addresses.

“Users deserve to know if they are transferring their hard-earned money into a platform that employs adequate safety measures and is completely transparent with user funds,” Binance added.

Binance to Launch a PoR Audit Mechanism

The latest development comes just a day after CZ revealed via a tweet that Binance will start to conduct a Proof-of-Reserves (PoR) audit mechanism soon to verify its digital asset holdings following a liquidity crunch that has hit rival exchange FTX.

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