Binance SQL Chain On Shakey Ground

In today's edition of YIYL, (You Invest, You Lose) we take a look at the shitcoiners favourite scam of a scam, Binance smart chain. The blockchain where small-time scammers can quickly spin up ponzi schemes and rug-pull their investors with very little effort.

While I've covered several projects that have failed or scam on BNB and the Binance SQL chain, I never really covered the primary Ponzi that this entire house of cards is built on, but I'll attempt to do that today.

This is all speculation on my part, but you know where there is smoke there is fire and boy has CZ been playing fireman the last few weeks with everyone wanting a forensic assessment of what goes on at Binance, the world's biggest shitcoin casino, the Tiktok of tokens.

What's behind BNB?

BNB is binance's exchange token, like CRO is to Crypto.com and FTT was to FTX, you could use it to attain certain perks with the exchange, but really this isn't a sustainable model for dumping made-up coins onto retail, even if you are the biggest gorilla in the jungle, you need something more.

FTT failed to get their token into the wider blockchain space and they got burned for it, while crypto.com knew they were in the shit and rugged all MCO users and forced them into CRO instead to buy some time.

Binance however, did something different they extended their exchange token outward and built two blockchains that use it. The Binance Chain and the Binance Smart Chain.

1 is a geth fork w/ smart contracts.
2 is cosmos fork w/ built-in dex & other bits

That's why you get BNB BEP-2 tokens the cosmos version, and BEP-20 the geth version.

If you want a more detailed break down you can find it here

Token allocation

When BNB was dumped on the market around 100 million was put up for sale while the rest of the tokens were kept for the team. All 200 million BNB tokens were pre-mined so there is no mining and staking is just a slow release of the pre-mine supply based on the whims of binance.

BNB bucks the price trend

What first got me interested in BNB is its performance in satoshis, there are only three coins that have topped their previous ATH in satoshis and BNB is one of them. The other 2 were doge coin and XRP if you're interested, but all other coins go to zero against bitcoin as they dilute their market with more printed tokens.

But BNB hasn't continued to increase in relation to satoshis, which had me wondering how are they doing this, with a coin that has a total supply of 200,000,000 and a circulating supply of 163,276,974 surely your most inflationary period would be first and then you would gradually drive less inflation over time.

Yes there could be so much demand for it that could boost the price but then wouldn't that reflect in other coins too? Why only BNB?

Sure BNB can be staked, pooled, its needed for fees, its burned by Binance, its used to secure certain perks on Binance or participate in IDOs and IEOs but these are all gimmicks, these aren't methods of driving sustainable demand so what gives?

Screenshot 20221221 at 08.13.03.png

Binance building cash reserves

A few months ago, I spoke about Binance rugging other stablecoin projects like USDC and encouraging customers to switch over to their BUSD token and that has done wonders for the growth in the coins market cap now sitting at the 6th biggest of all coins with 18 billion. The difference with BUSD market cap is that it's not traded at the margins, its meant to be backed 1-1 with USD held by Paxos.

So unlike selling 18 billion of BNB would tank the price, in a stablecoin, if you sell 18 billion you should get that same amount in fiat should it be backed.

Now that's a pretty big treasury to have to play with, and yes some of that BUSD sits on other exchanges to create markets, some are on DEX exchanges in liquidity pools, some are held in wallets to be used as liquid cash, but a fuck tonne of it sits on Binance.

IF, and this is a big if you had that much financial fire power and you pulled an FTX you could clearly find ways to wash trade and temporarily protect certain price points.

You could also stamp out shorts or longs if they get too leveraged by moving the price to reduce leverage on the token. Rekking traders but keeping your base token from being creamed like we've seen with more illiquid shitcoins whose market makers don't have the capital to defend it.

Screenshot 20221221 at 08.12.43.png

https://twitter.com/DataFinnovation/status/1604423045564682241
- DataFinnovation

Please trust, since you can't verify

Despite using a blockchain, we can't really tell what goes on in either of the two chains, and if assets are being double spent or moved around, because no ones running a node for the two chains that isn't Binance themselves.

So despite you looking shit up on BSC scan, you're pulling data from Binance's node, and they can feed you all kinds of flavours of shark shit and you would be none the wiser because you don't know that you need to verify the source, not just the data.

The two-chain system is purposely built to be opaque and since we don't have access to Binance's books because they're a private company we don't know between these 3 environments, how many liabilities are attached to the assets you might see and how much liquidity is backing those assets.

According to Bloomberg 40% of Binance holdings is BNB and BUSD that's a pretty large position in something when you're the buyer of last resort. Around 50 billion or so is BNB, do you honestly think they could liquidate that position?

The token has a daily trading volume of $538,753,167 so absolutely fucking not, that's illiquid as constipation.

The cooks don't want to look at the books

According to the Guardian Auditing firm Mazars, which had published a proof of reserves report for exchanges like Luno, have started to distance themselves from Binance. Mazars, in an email to CoinDesk, said it was pausing work with crypto clients globally due to

“concerns regarding the way these reports are understood by the public.”

All I am here to say is something is rotten in the state of Denmark, and before I go, I leave you with CZs interview about all of this and I'll let you decide if this is someone projecting confidence or they're actually know they're above board.