The latest development of BFX storm, debt-for-equity or debt-to-coin?
Yesterday, I said that I was not worried about the BFX incident for three reasons:
1. The money may not be brought back. Of course, the possibility of not getting back is still very big. At least it will not be returned in a short time. Although the official said that the funds can be thawed in the near future, the individual is still more skeptical about this. Especially in the current sensitive period, the possibility of thawing is even smaller.
2. Even if the loss of 850 million US dollars, BFX has full strength to make up for the deficit. According to Dong Ge, last year's BFX's profit was nearly 400 million US dollars, and the profit was reduced, that is, two or three years, it could be COVER.
3. Before BFX had a precedent for losing money, when the debt-to-equity swap was spent, Dongge became a shareholder of BFX. Therefore, personal guessing, BFX can completely reinvent the technology, and then re-debt-to-equity, to compensate the user's losses in the form of transfer of shares.
It is based on these factors that I am not worried about BFX, but the current progress of the incident is somewhat unexpected.
1. When the crisis is coming, is the user completely lost confidence in BFX?
Confidence is more important than gold. Once users lose confidence in BFX, it is a disaster for BFX. Once, users lost confidence in BFX. Will you continue to trust BFX this time?
If you choose to continue to trust, everyone will continue to work together in the same boat, and it will not be a hurdle to overcome the difficulties. If you don't trust, the consequences will be very serious, and there will be a large loss of users and a bite of a bitcoin dollar run.
In the case that the USDT cannot be used, the user will choose to buy the BTC, then withdraw the cash and leave the BFX. At present, it is unrealistic for BFX to enter and exit with US dollars, and only BTC can leave. The BTC premium on BFX is nearly $200.
Therefore, for BFX, it is imperative to stabilize the military and avoid the emergence of user crowds. This is undoubtedly a crisis, and it is time to test the BFX crisis's public relations capabilities.
2. The three principles of crisis public relations: timely, transparent and sincere.
Xu Xiaoping said that the best crisis public relations is to honestly acknowledge the facts, come up with compensation to make up for the fault, and propose measures to prevent it from happening.
Admit the facts, timely communication is very important, and active communication is very important. The truth of the matter has become more and more clear, and it is better to say it in a big way than to cover it up.
For BFX, the money hosted in Crypto capital is frozen, and BFX is also a victim. It is also important to show evidence and win sympathy.
What is the evidence of the freeze, it is impossible to get it back, what measures have been taken, what has been done, and how it works. If you can't get it back, what to do, what are the emergency measures, and what is the solution.
In the absence of the truth, people always imagine things in the worst direction. Unclear truth can be frightening, and long-term unclear truth can cause panic. Officials should actively disclose information and promptly disclose some valid information, such as the latest developments, previous business data, BFX's solvency, current emergency BTC and cash reserves.
When dealing with crises, the government must show sincerity, attitude is very important, recognize the facts, take the initiative to apologize, and come up with a solution. The current emergency measures, prepare the necessary funds to deal with the tide of the crowd; at the same time, come up with a solution to the problem as soon as possible, debt-for-equity swaps, debt-to-coin or better, communicate as soon as possible, and resolve as soon as possible.
It is also good to find KOL to speak for yourself. The currency is also a good idea. Debt-to-coin can also make up for the deficit, and bind the users to a boat. At the same time, it can divert the line of sight and rebuild confidence.
3. Some people think that the US SEC will not approve the Bitcoin ETF due to the USDT overshoot, and that Bitfinex is an sinner.
In the past 24 months, the US Securities and Exchange Commission (SEC) has been cracking down on Bitcoin ETF applications on the grounds that it is concerned about the manipulation of bitcoin ETFs, lack of investor safety, and inadequate market regulation.
Whether the USDT is over-issued has always been a mystery. Although the official has always denied it, it has not provided valid evidence. According to market speculation, the possibility of over-issuance is so great that many people think that the USDT is over-revolutionary and has blown up the bull market.
Therefore, this time BFX storm, Tether's misappropriation of reserves has been solid, not open, opaque, causing stronger doubts about USDT overshoot, and will definitely affect the approval of ETF. However, in any case, the possibility of ETF adoption is not high in the short term. It is more important to wash yourself clean during this time. The ETF will naturally come naturally.
4. How to see the market outlook
Because of the BFX incident, if users buy BTC in large quantities, leave the market from BFX, and sell to other trading platforms, the impact on the market is still quite large. In the short run, it is definitely bad. If things continue to ferment, market sentiment will spread and the panic index will continue to fall.
Coupled with the frequent breaks in the recent IEO, rights violations continue to occur, which is a serious blow to the market. Therefore, in the short term, the market is not optimistic.
In addition, a few people have recently been harvested, I still remind you that free money management is the right way, do not take the life of the family to gamble, gambling is gambling, even if it is gambling, also look for high odds, you Take gambling as a value investment, I can only bless you, go all the way.
(Author: Allin Block Chaining)