$1.2 Million Giveaway Announced By Binance CEO, As 'Thank You' for 'Standing By Us'

Changpeng Zhao (“CZ”), the CEO of Binance, the world’s largest cryptocurrency exchange in terms of trading volume, has announced via Twitter that $1.2 million in Binance Coin (BNB) will be given away “as a thank you for standing by us.”

On May 7th, 2019, Binance’s management revealed that its exchange had suffered a large-scale security breach, which resulted in the loss of over 7,000 Bitcoin (BTC) from the trading platform’s hot wallets.

Improved “Security Measures, Procedures, Practices”

On May 10th, the Binance co-founder published an update on the exchange’s official website in which he noted that important changes had been made to the trading platform, following the $41 million hack. According to Zhao, Binance’s management had taken measures to drastically improve “security measures, procedures, and practices.”

The hacker(s) had not only managed to steal a large amount of cryptocurrency, but they had also reportedly gained access to users’ 2-factor authentication codes and API tokens. In order to address these vulnerabilities, Binance’s team has been "making significant changes to the API, 2FA, and withdrawal validation areas."

On May 15th, 2019, Binance’s management announced that the exchange’s system upgrades had been completed and that “all trading activity” would resume “at 1:00 PM (UTC).” As mentioned by Binance’s team, users would be allowed to cancel open orders “until the commencement of trading.”

Helping Users Better Understand Security Measures

Traders may also perform other account related functions, including making deposits. However, Binance’s blog post clarified that the exchange’s “withdrawal function will [only] be available shortly after trading resumes.”

In order to help users better understand how to secure their cryptoassets, Binance’s team has published an informative blog post, titled: “14 Tips to Enhance Security for Your Binance Account.”

To prevent hackers from stealing funds, Binance’s blog mentioned that users should keep changing their passwords (from time to time), reset their 2FA, and also “update their anti-phishing code.”

Giveaway Is A Way To Acknowledge “Unwavering Support” From Community

The exchange operator also confirmed it will be “holding a 50,000 BNB giveaway” and that it will be “providing VIP level ups.” The generous giveaway is a way for Binance’s management “to express [its] gratitude” for the “unwavering support” it has received from its users.

To participate in the giveaway, users are required to “trade over 1 BTC to share a 50,000 BNB prize pool.” The promotion period began on May 15th, 2019 “at 1:00 PM UTC” and ends on May 18th, 2019 “0:00 AM UTC.”

CME Looks to Double Bitcoin Futures Limit, but Is This Wise?

The Chicago Mercantile Exchange (CME) has a new request for its regulator, as it looks to double open position limits on bitcoin futures contracts in the face of significant interest.

Nasdaq reports that the CME has already petitioned its regulatory body, the Commodity Futures Trading Commission (CTFC), asking for an increase from 1000 contracts per spot month to 2000 per investor. Each contract represents five BTC, so essentially, at its peak,  a single investor's total position may edge towards a monumental 10,000 BTC.

This is in direct response to the contract's recent growth which is currently depicting record levels of activity, citing $370 million being traded per day. A spokesperson for the CME noted that the idea to increase limits was proposed on the continued maturity of the market:

Based on the significant growth and acceptance of our financially-settled CME Bitcoin futures markets, as well as our analysis of the underlying bitcoin market.

However, as Nasdaq writes the increase in the upper limit of positions is somewhat superfluous. As of July, the number of open interest contracts reached an all-time high of just 6100; given this, it seems the CME may be future-proofing.

Open to Manipulation?

However, concerns remain about the limit increase, as without them, the potential for manipulation rises; often to the detriment to the underlying asset. Although, as per the CTFC website, the threat of manipulation from bitcoin futures contracts is "low":

In general, position limits are not needed for markets where the threat of market manipulation is non-existent or very low.

Instead, Nasdaq posited that this might point to a lessening on the CTFC's strict rule of bitcoin; as well as a maturing of the market in general.

Nevertheless, some believe the CME's bitcoin futures contracts do pose a significant threat to the price of BTC; with some suggesting that blatant manipulation continues unchecked within the market.

As reported, there seems to be a correlation between the expiry dates of CME bitcoin futures contracts and a lull in the price point of BTC. In several instances, a significant drop in bitcoin's price has coincided with a closure from the CME. The most recent example of this occurred on Labor Day, September 2, when bitcoin rose an extraordinary 8% shortly after the CME shut.

Crypto analyst, Alex Kruger, highlighted this, noting the large gaps which formed on the CME chart, from the price discrepancy before and after closing.

This has become a pretty accepted practice within the market. Kruger has even gone to the lengths of compiling statistics each time this phenomenon transpired:

On these occasions, bitcoin cited an average 4.6% price discrepancy following the close of the CME.

Whether this is a coincidence or the market is indeed being actively manipulated is as yet unclear. Either way, with the increase of these limits it might be only a matter of time until we know for sure.

Featured Image Credit: Photo via Pixabay.com