CZ: Binance Could Tap SpaceX Stake for Hack Losses

Binance’s SpaceX Stake Valued Over $1 Billion Amid Hack Recovery Discussions

Former Binance CEO Changpeng Zhao, widely known as CZ, has indicated that the cryptocurrency exchange could leverage its stake in Elon Musk’s SpaceX, now valued at over $1 billion, to offset losses stemming from a significant hack. The exchange reportedly suffered an estimated $6.3 billion in affected assets following the security breach.

The discussion emerged after CZ responded to a post by Elon Musk, who had shared a smiling emoji in reaction to reports suggesting Binance had sufficient funds to cover its losses. CZ, in his reply, expressed respect for Musk but urged him to cease what he perceived as trolling, highlighting the substantial value of Binance’s investment in Musk’s company.

“Elon, have a lot of respect for you, but bad time to troll. Please stop. Our SPCX shares (from our $500m investment in your Twitter takeover) are worth more than a billion. Would appreciate if you show a little support. Thanks!” CZ stated.

Binance’s investment of $500 million in Musk’s acquisition of Twitter resulted in the exchange receiving shares in the company, which are now linked to SpaceX (SPCX) and have appreciated to over $1 billion.

When questioned by an X user about how this investment could aid in covering the hack losses, CZ provided a breakdown of the remaining financial gap. He explained that approximately $3 billion of the stolen funds had been frozen by various entities. Tether froze over $1.56 billion in USDT, Circle froze more than $800 million in USDC, Ripple assisted in freezing around $200 million, and World Liberty Financial froze approximately $27 million.

CZ’s “rough math” indicated a remaining gap of about $2 billion after accounting for the frozen assets and Binance’s SAFU (Secure Asset Fund for Users) fund, which holds $1.x billion. He noted that the SpaceX stake alone, valued at over $1 billion, would make this remaining shortfall “manageable, although still painful.”

However, Binance co-founder Yi He offered a different perspective, suggesting that the exchange’s annual revenue is sufficient to cover the remaining losses without the need to liquidate the SpaceX shares.

“Reporting to the major shareholder: Our company’s revenue for the year is sufficient to cover the losses, so we do not yet need to sell the SpaceX shares you are bullish on,” Yi He stated, adding that Binance did not require selling the SpaceX shares at this juncture.