Binance founder reveals what prevents the cryptocurrency industry from growing

Чанпен Чжао" href="https://noworries.media/biography/chanpen-chzhao/" data-bio-id="3681">Changpeng Zhao, CEO of cryptocurrency exchange Binance, believes that the industry is not growing due to a lack of resources. CZ spoke about this in more detail at the Token2049 conference in Singapore.

During the summit, Zhao was asked what should be done to attract another 100 million users to the cryptocurrency industry. He answered that the first step is to simplify the ways of exchanging cash for cryptocurrency. It is the lack of simple and convenient tools that hinder expansion, the Binance owner is convinced.

«Due to the tightening of regulations earlier this year, many traditional institutions that used to provide fiat channels are going into the shadows,» Zhao said. The collapse of the FTX cryptocurrency exchange last year triggered a massive outflow of money from crypto platforms. As a result of the negative sentiment on the crypto market, many traditional financial institutions that had previously cooperated with crypto firms began to abandon clients.

In March, cryptocurrency-friendly banks such as Silicon Valley Bank, Signature Bank, and Silvergate Bank collapsed. After their closure, crypto firms have even fewer opportunities to easily exchange fiat for cryptocurrency.

In addition, regulatory measures against cryptocurrency companies have been tightened in the United States. In June, the U.S. Securities and Exchange Commission filed a lawsuit against Coinbase, claiming that the crypto exchange had violated securities regulations. This happened just a day after the SEC brought similar charges against Binance and Changpeng Zhao.

As a result, in the first two days after the lawsuits were filed, traders withdrew about $ 1.5 billion from Coinbase and almost $ 2 billion from Binance. Over the same two days, Zhao’s fortune decreased by almost $ 1.4 billion, and Coinbase CEO Брайан Армстронг " href="https://noworries.media/biography/brajan-armstrong/" data-bio-id="3684">Brian Armstrong 's by $ 361 million.

As a reminder, in May, the trading volume on centralized cryptocurrency exchanges fell to a four-year low. At the beginning of the year, the turnover of digital assets and derivatives began to increase, but in April a negative trend reappeared, which continued in May. The largest decline in digital asset turnover was recorded on Binance. The crypto exchange’s market share fell to 43%. For comparison, in February, this figure reached 57%. Crypto platforms such as Bullish, Bubit, and BitMEX benefited the most from Binance’s decline in popularity, with their market share increasing by more than 1%.