Changpeng Zhao, CEO of Binance discusses the future of cryptocurrency, global adoption, and regulation
In a recent interview, Binance CEO Changpeng Zhao discussed regulations and crypto ETFs. He claims that “At this point, most institutions or organizations should be considering crypto.”
Let us recall that just last month, Jamie Dimon, chairman and CEO of JP Morgan Chase, called Bitcoin “worthless.” However, crypto-asset inflows this year are breaking all records. According to the CoinShares report dated November 8, 2021, YTD inflows have reached a new high of $8.9 billion.
Aside from that, CZ stated, “Crypto is the future of the FinTech industry.” And, to be honest, it’s the future of money.” While some in the industry believe the crypto bubble will burst, institutions that believe otherwise are preparing. Mastercard recently announced a partnership with a number of cryptocurrency companies to launch crypto-funded payment cards. Furthermore, more fund managers are looking into crypto-focused exchange-traded funds.
Bitcoin’s recent rally has been fueled in large part by the approval of the first futures-based Bitcoin ETF in the United States. CZ Binance has also stated that “the growth of ETFs is a very positive thing.
However, it is worth noting that more applications are being submitted in the meantime. BlockFi, in collaboration with Neuberger Berman, filed for a spot Bitcoin ETF. Because it is a physically-backed Bitcoin ETF, it is likely to face regulatory obstacles before it is approved.
But, with so many options available, is the market becoming saturated? CZ believes this isn’t the case just yet. According to Binance’s CEO, there is currently no overlap in the sector. He stated
“The crypto industry has only about a 5% global penetration. So, out of a billion people, probably only about 400 million have crypto, which is already a sizable number, but it represents only 5% adoption.”
As a result, he explained, a saturation level could begin as soon as we reach 95 percent adoption. In a recent event, Bank of America Chief Operating Officer Tom Montag also discussed crypto competition. In the context of traditional businesses, he noted that crypto can provide banks with a “technological leap.” Montag’s outlook is similar to CZ’s. “We’re looking forward to figuring out how to best use it [crypto] and have it become a part of the system.”
However, incorporating cryptocurrency into mainstream finance would necessitate close collaboration with regulators. Binance co-founder Yi He previously discussed efforts to “work better with regulators” in an interview. While the company has made strides with recent high-profile hires, CZ reiterated that Europe and the United States are large markets. He stated,
“As a result, we want to capitalize on that and contribute to the growth of the community in France and throughout Europe.” (sic)
Meanwhile, he stated that, in terms of US regulations, “Typically, US regulators place a high priority on KYC AML, terrorist money laundering, and so on…”
According to CZ, Binance is currently focusing on working “closely with regulators all over the world.” The looming question is whether other crypto businesses should take the same path.
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