BlockBeats News, March 10th, Liquid Capital (formerly LD Capital) founder Daniel Li posted a message stating, “In recent years, the biggest problem in the crypto industry is innovation decline, which stems from two aspects: first, the crypto policy tightening by the previous U.S. government, which should be resolved with the passage of this crypto regulatory bill. Second, Binance’s requirement for projects to implement a 1➕3 year lock-up mechanism for crypto VCs.
I believe Binance’s original intention was good, aiming to cultivate a long-term investment mindset. However, the current consequence of this mechanism is that project teams, liquidity providers, and exchanges run first, while VCs face the risk of going to zero during the long unlocking period. VCs already bear the greatest risk in the primary market but now also face the risk of the latest exit, which is clearly contrary to the traditional investment market. The result is the collective disappearance of crypto VCs, making it difficult for high-quality entrepreneurs to raise funds and reducing industry innovation.
I have a suggestion for Binance founder CZ: provide a better exit mechanism for crypto VCs to activate VC capital and benefit industry innovation, as well as facilitate the listing of high-quality assets on exchanges.”
