Tech

CZ Urges BNB Treasury Firms to Use Custodians

3 days ago
Bitcoin Ethereum News

Key Notes

  • QMMM has suddenly disappeared with investors’ funds, sparking safety updates.
  • Now, Changpeng Zhao says it is mandatory for the BNB DAT project, looking to secure investment from YZi Labs, to have a third-party custodian.
  • China Renaissance Holdings is looking to invest $600 million in a BNB treasury.

As the number of firms investing in a corporate BNB

BNB
$1 059



24h volatility:
9.6%


Market cap:
$147.81 B



Vol. 24h:
$4.81 B

treasury increases, Binance founder Changpeng “CZ” Zhao has seen the need to educate them.

Recently, he took to X to encourage such BNB treasury firms to utilize the service of third-party custodians for their holdings.


His statement comes as Digital Asset Treasuries (DATs) become a hot topic in the crypto industry.

QMMM Disappearance Trigger Third-Party Custodian Talks

In the last few months, several traditional institutions have tilted towards maintaining a crypto-based treasury. However, the hype and adoption came with increased risks, and this has caused many enthusiasts to begin to raise questions about transparency and safety.

CZ’s call for safeguards and accountability across DAT comes from these concerns.

The conversation began with concerns that QMMM, a crypto treasury firm, might have vanished with investors’ funds.

According to AB Kuai Dong on X, the U.S.-listed firm had announced plans to invest $100 million in Bitcoin

BTC
$105 022



24h volatility:
4.9%


Market cap:
$2.09 T



Vol. 24h:
$109.77 B

, Ethereum

ETH
$3 752



24h volatility:
6.2%


Market cap:
$452.81 B



Vol. 24h:
$58.68 B

, and Solana

SOL
$179.0



24h volatility:
7.2%


Market cap:
$98.07 B



Vol. 24h:
$11.86 B

, and its stock price shot up to 9.6 times after the news.

Not too long after, the US Securities and Exchange Commission (SEC) claimed that QMMM manipulated its stock using social media.

As it stands, its Hong Kong office is now reportedly empty. Fears have risen, likely due to the absence of a separate custodian.

CZ advises all DAT firms to use a trusted third-party crypto custodian. He also encouraged them to have their accounts audited by investors.

While he sounded this advice to companies, CZ explicitly stated that this will now be a mandatory step for any BNB DAT project looking to secure investment from YZi Labs.

This further highlights his commitment to promoting transparency in the cryptocurrency sector.

Firms Establishing a BNB Treasury

One of the companies that recently attempted to establish its BNB treasury is China Renaissance Holdings.

This Beijing-based investment bank is working on raising around $600 million for a new BNB treasury company.

Some sources claimed that YZi Labs and China Renaissance will contribute $200 million to the deal, with the bank committing around $100 million of that amount.

Also, Applied DNA Sciences secured up to $58 million for a BNB treasury strategy through a private investment in public equity (PIPE) offering.

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Godfrey Benjamin

Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.

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Source: https://www.coinspeaker.com/cz-warns-bnb-treasury-safety/