Binance criticised for listing SushiSwap DeFi token

The Block analyst Larry Cermak criticised Binance chief Changpeng Zhao. Zhao had publicly backed the SUSHI token that Binance had listed shortly before its sharp decline. The expert noted that the exchange has a duty to safeguard users’ funds during the project evaluation phase.

As one of the leaders of the space, we support innovation. With innovation comes the chance of high reward, and high risk. Some projects make it to the moon, while some fall short. Always manage your risk accordingly.

— CZ Binance (@cz_binance) September 6, 2020

Over the weekend the price of the SUSHI token plunged by half after the platform’s administrator sold half of the developers’ fund assets worth $27 million.

In response to criticism from users affected by the dump, Zhao urged not to forget risk management. He stressed that the Bitcoin exchange he runs aims to support innovation. With innovation come not only chances for price appreciation but also the risk of a complete failure.

In the ensuing discussion, the head of Binance stated that investments in any coins carry risks. DeFi tokens are no exception.

According to Zhao, Binance acts only as a liquidity provider. Therefore, if the listing does not include current coins, the platform will lose in the competitive race. The exchange chief noted that he does not know the founder of SushiSwap, and the platform does not encourage purchases of the protocol’s native token.

Cermak, in reply to Zhao’s deleted tweet, not shying away from irony, explained that Binance continually refines its comprehensive listing-due diligence. When such failures occur, as with SUSHI, Zhao, the analyst concluded, simply unfollowed and that was that.

You literally cannot make this up. The mental gymnastics pic.twitter.com/vKVvAVZzFe

— Larry Cermak (@lawmaster) September 6, 2020

Not all users agreed with Cermak’s arguments. Among those who actually supported him was well-known trader Michael van de Poppe. He drew attention to Zhao’s earlier published form for listing tokens on Binance. A mandatory condition in it is the mention of the project’s founder or its leader in case of unforeseen circumstances.

Van de Poppe suspected in Zhao’s latest tweets a violation of the principle of impartiality, and urged the community to pass judgment.

The SushiSwap administrator “Chef Nomi” handed control of the DeFi platform to its founder and CEO of the FTX exchange, Sam Bankman-Fried. This followed accusations of an exit scam and a token dump.

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