Blog

Crypto Doesn’t Need a Savior!

Changpeng Zhao (CZ), Binance CEO, has spoken out against what he calls “wrong narratives.” He has criticized those in the community who have portrayed him as the “savior of crypto.”

Who Is Changpeng Zhao?

The founder and chief executive officer (CEO) of Binance, the largest cryptocurrency exchange in the world, Changpeng Zhao, also known as “CZ.” In 2017, Zhao established Binance, which saw an immediate rise in daily trading volume to more than $20 billion. Zhao is an avid Bitcoin enthusiast who has amassed a fortune in cryptocurrency. However, Binance Holdings Ltd. accounts for the majority of his more than $15 billion net worth.

The crypto industry was rocked by the collapse of FTX. Cryptocurrency’s future remains uncertain, particularly given that victims of the FTX contagion continue to fall like dominoes.

The upheaval sent Bitcoin’s price well below $18,000, raising concerns about the long-term viability and solvency of major centralized exchanges like Binance. Changpeng (CZ) Zhao, CEO of Binance, increased his media presence during this disaster, and some market participants even began to consider him the “savior of crypto.”

Did Binance buy FTX?

According to Zhao’s tweet, Binance signed a non-binding letter of intent (LOI) to purchase FTX on November 8, 2022. The deal was called off after a day of due diligence, and Binance did not buy FTX.

But even in these turbulent times, does cryptocurrency really require a savior?

Impacts of the FTX Contagion The FTX contagion posed a threat to enormous organizations like the Digital Currency Group (DCG). Genesis, the lending arm owned by DCG, is attempting to avert bankruptcy. BlockFi, another exchange, filed for bankruptcy at the same time, and other exchanges stopped accepting withdrawals.

In order for businesses to survive the bear market, there have also been layoffs across the entire industry.

In order to challenge Binance’s dominance, FTX was a rising competitor. However, with FTX’s demise, Binance is one of the few major players in the market. The market share of all centralized exchange (CEX) volumes held by Binance is 77%.

The Savior, Changpeng Zhao?

In order to prevent the cascading effects of FTX and assist strong projects that are experiencing liquidity shortages, Zhao announced a $1 billion industry recovery fund.

Some people have said that Changpeng Zhao is “self-serving and monopolizing the market for his own benefit,” but others say that he is a hero.

CZ said, “that’s the beauty of decentralization” in a Twitter thread pointing out some “wrongful narratives” that crypto does not need to be saved.

However, some members of the community made the observation that he is comparable to Sam Bankman-Fried in that no one regards him as a hero. For Changpeng Zhao, who runs a centralized crypto exchange, to praise decentralization is, according to many, hypocritical. Others seem to be okay with it and want the CEO to take on the role of rescuer.

 

Is a Savior Required for Crypto?

Bitcoin has encountered numerous difficulties since its inception. In the bear markets of 2013, 2017, and 2020, the BTC price has corrected above and below 80% over time. After being hacked in 2014, one of the earliest cryptocurrency exchanges, Mt. Gox, lost 650,000 Bitcoin and went out of business. The first significant crypto bear market occurred as a result.

In 2017, China imposed a number of crypto bans, causing the market to plummet from $20,000 to $3,000 In a similar vein, the COVID-19 pandemic resulted in a flash crash in the year 2020. Due to such market crashes, Bitcoin has been declared dead nearly 500 times.

The most recent bear market in 2022 has been a little different. This time, the primary causes are multiple collapses of over-leveraged exchanges and poor global macroeconomic conditions. However, crypto has survived and emerged stronger from each crypto winter over the years.

Copyrights © 2021 ZareTech.