Binance CEO Changpeng “CZ” Zhao has shared his take on "two big lessons" to be learned from the FTX saga, saying cryptocurrency firms shouldn’t use their own tokens as collateral and should also keep “large reserves.”

Two big lessons:

1: Never use a token you created as collateral.

2: Don’t borrow if you run a crypto business. Don't use capital "efficiently". Have a large reserve.

Binance has never used BNB for collateral, and we have never taken on debt.

Zhao shared that his first lesson is to ensure a firm's collateral should not consist of a token that it has created, and claims his exchange’s token — Binance Coin BNB — has never been used as collateral for its services.

Zhao’s second lesson from the downfall of FTX is that crypto businesses shouldn't be borrowing, and instead should opt to maintain large reserves — which could be in reference to FTX users complaining of sluggish withdrawals on Nov. 7, sparking rumors the exchange didn't have enough to cover user funds.