Binance Founder Breaks Silence On Libra Crash: “Token Economics Matter”
Highlights
- Binance founder says tokenomics matter in considering a healthy asset
- This commentary came from the collapse of LIBRA, a Julian Peh backed token
- Celebrity tokens now emerging at a very fast pace
Binance Founder Changpeng ‘CZ’ Zhao has shared his take on the recent pump-and-dump scheme associated with the LIBRA token. Taking to his X handle, he shared 4 key takeaways that key stakeholders in the industry need to watch out for. Notably, this take comes amid a growing shift toward celebrity tokens in the broader market.
Binance Founder on Ideal Token Signs
According to the CZ post, industry personalities with respected online profiles must be careful when endorsing a token. He noted that token economies matter for any kind of asset. The former Binance CEO said a lot of research must be done before a user decides to invest or not.
He also noted that buying a new asset is inherently risky. He also insinuated that with the growing industry, there is a lot of money from investors ready to be invested. This floating capital in the community entered some memecoins lately.
The President Trump family launched the TRUMP and MELANIA tokens in January. The massive embrace of these tokens pushed TRUMP to the top 15 in the market within days. However, these assets have lost bullish momentum, leaving many investors in losses.
LIBRA Token and Argentina Ties
The comment from the Binance founder came as a response to a thread from Pix, a self-acclaimed Web3 researcher. Pix dived deeper into the origin of the LIBRA token and the ties with Argentina President Javier Milei. Despite the link and narrative, LIBRA crashed by 90% after hitting an all-time high of $4 billion valuation.
According to Pix on X, Julian Peh, an investor who bought Bitcoin in 2016, launched the token. With runs to Ethereum and NFTs, Peh soon became vast in the new tech world.
He first met the Argentine President in 2021 when he gave a speech on AI, small businesses, and the future at a conference. Impressing Milei, KIP, the company founded by Julia Peh, joined the Buenos Aires Blockchain Committee.
Through this linkup, he pitched the idea of a national token to support small businesses. President Milei bought the idea with his plans for transformation and shared the first post about the token on X. This triggered a massive Fear of Missing Out (FOMO) as investors poured in case.
With $87 million pulled out by insiders after Milei deleted his post, many now tag the LIBRA token as the biggest political rug pull in history.
Binance Founder Almost Caught in Memecoin Saga
Meanwhile, Changpeng Zhao almost mixed with a similar memecoin frenzy earlier this week. The trend started when he posted online his dog Brocolli, a Belgian Malinois.
In a short while, many memecoin variants tracking the price of the dog came online. One whale made huge gains after betting on BROCCOLI as the price rallied over 160%.
Some investors even demanded that CZ drop a contract address for a token linked to the dog. However, he refused, avoiding another potential failed celebrity token. From his experience, he noted that the Argentina LIBRA token could have recorded a better outcome if properly planned.
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