Binance snags CoinMarketCap in major acquisition
It's believed to be one of the largest acquisitions in the cryptocurrency space to date.
Binance has acquired CoinMarketCap for "an undisclosed sum" according to a press release.
The undisclosed sum was $400 million in a combination of equity and Binance Coin, according to an anonymous insider. This would make it one of the largest acquisitions in the cryptocurrency space yet.
"The core DNA of CoinMarketCap is strongly aligned with Binance’s ethics and culture, from its integrity to its value of freedom, transparency and user-focus," said Binance CEO Changpeng "CZ" Zhao.
"Our common vision will be strengthened by this acquisition to further growth and
instil transparency in the industry. This will enable us to build on each other’s strengths, jointly serving as infrastructure providers of crypto."
CoinMarketCap founder Brandon Chez will be stepping down as the site changes hands, with current chief strategy officer Carylyne Chan taking the reins.
Chez will remain as an adviser.
"I believe that of all the teams in the space that could acquire CoinMarketCap, Binance is one of the very best options. They are a team that have shown, time and again, that they care about their users and will do the best for them, even in the most challenging of times," Chez said.
"This spirit will continue to be echoed in our own user-focused philosophy at CoinMarketCap, and I am thrilled to be passing the baton on to Carylyne and the CoinMarketCap team to continue fulfilling my original vision of showcasing the crypto revolution."
By the numbers
While some may raise their eyebrows at the idea of one of the world's largest cryptocurrency exchanges acquiring one of the world's most popular cryptocurrency price feeds, and some of the more hardened cynics might expect foul play in the data, it's worth noting that the realities of the space mean you shouldn't trust a single data source anyway.
Recent DeFi incidents have proven that you need multiple data streams for applications, while other limitations mean information can only really be given on a "buyer beware" basis.
For example, if you head to CoinMarketCap's self-reported exchange volume list you end up with a list of mostly fake numbers from mostly-shady exchanges.
The data there is not meant to be accurate, and no one is expected to believe it's accurate. It's more of a running list of which exchanges are doing the most wash trading.
If you head to the massaged exchange volume list, you get a tweaked set of numbers that also aren't guaranteed to be correct.
It's up to the user to understand what the numbers actually mean, not unlike the way exchange users are obligated to find out what they're buying before they purchase a random token.
In this kind of space, there's something to be said for just shrugging one's shoulders and saying "take the data as it is, believe it or don't."
“Ever since our humble beginnings in 2013, we have been public about our commitment to remaining neutral by avoiding censorship and judgement of projects or exchanges that we list, preferring to let users make their own decisions based on the data," said new CoinMarketCap interim CEO Carylyne Chan. "We are delighted that the Binance team has been unequivocal in ensuring that we can continue to adhere to our methodology without prejudice."
Disclosure: The author holds BNB, BTC at the time of writing.
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