Binance Chief Executive Officer Zhao has urged world governments around the globe to resort to regulation other than fighting crypto. Zhao advised governments that there are better ideas than fighting crypto as it becomes more mainstream.
Crypto regulation has faced more scrutiny over the past few weeks following the collapse of FTX-a famous crypto exchange platform. At a Binance event in Athens, Zhao said governments worldwide must come to terms with crypto adoption. He added that regulating the crypto industry is better than throwing fists at it.
A little bit of light was shone onto the crypto world after FTX filed for bankruptcy protection in the US, November 11. This came after FTX users withdrew around $6 billion from the platform in just three days. FTX’s fall has caused around one million traders to lose billions of dollars from their portfolios.
However, the Binance CEO expects that the market will recover. Zhao said that 2022 was a terrible year for crypto. He added that despite witnessing an eventful two months, the market would soon stabilize.
Zhao insisted that the collapse of FTX does not mean that all crypto businesses are bad. In the same event, the Binance CEO was asked whether he expected governments to begin to accumulate Bitcoin as part of their national reserve. He responded by saying he expects governments to acquire Bitcoin, especially those which do not have their currency. He added that smaller countries are likely to start first.
In another event, Zhao mentioned that the launch of digital currencies by central banks was not a threat to the crypto market. Zhao’s statements come amidst major central banks such as the US Federal Reserve and the Bank of England plans to launch digital forms of their currencies-CBDC.
In a news conference in Lisbon, Zhao insisted that CBDC was not a threat to either Binance or the cryptocurrency market. In fact, according to him, the more digital currencies available in the market, the better. Zhao added that blockchain technology used by cryptocurrencies should be made available to these governments and that CBDC should adopt this technology.
Data analysed by the Bank of International Settlements shows that around 9 of 10 central banks have considered launching their versions of digital currencies. In addition, research conducted by the CBDC tracker for the Atlantic Council showed that more than 100 significant banks are feeling an effort to launch their digital currencies.
Adopting blockchain technology by CBDC will help clear doubts about the whole concept. Zhao said that since these governments will have adopted the technology, most of the concerns among their citizens will dwindle. It is also worth noting that Binance invested $500 million in Twitter after Elon Musk purchased the social media platform this year.
Zhao added that having more digital currencies was an added advantage. However, he reminded the news media that despite both being digital currencies. CBDC would still be very different from crypto because cryptocurrencies are deflationary assets, unlike fiat. According to the Binance CEO, CBDC and crypto would be inversely correlated despite being directly related today. Zhao said this was caused by the fact that most people who trade crypto also trade stocks.
In the Web Summit-Europe’s biggest tech conference, Zhao said that for the Fed to get more cash, they raise interest rates to crash the market by selling crypto.
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