Founder And CEO Changpeng Zhao Of Binance Strongly Critiques Cryptocurrency Industry Players’ Speculations That There Is Possibility That The Government Will Ban The Virtual Currencies
Binance CEO Changpeng Zhao has critiqued cryptocurrency industry players who believe that the government will ban virtual currencies such as Bitcoin and Bittrex, among others. The players say that the government will only allow cryptocurrency use as an asset. The CEO believes otherwise that it is not practically possible.
According to Changpeng Zhao, cryptocurrency has value, and there are millions of people worldwide who have a thirst for rare high-end digital currency. The currency has liquidity, meaning that there are ready buyers and sellers. Traders can exchange the cryptos for another asset. As long as there is an agreement between a seller and a buyer, it remains a suitable medium of exchange.
Banning a medium of exchange isn’t possible unless it is illegal to perform such a function. The name of the medium also does not matter in that case. It could be a Dollar, Bittrex, or any other currency in the world.To illustrate better how the digital currency is valuable, this past weekend, Bitcoin, one of the most common virtual currencies, reached a new high of $61,000, an indication that it continues to enjoy its popularity against other cryptocurrencies.
Bitcoin has a 1% penetration in the world and is the most traded. The market heavily dictates crypto price. Though the weekend’s Bitcoin price looks unrealistic, Mr. Zhao believes that the $61,000 Bitcoin price is fair. To him, Bitcoin is unstoppable. That is the same case with other digital currencies.
The Binance CEO says that the world is in the early stages of various cryptocurrencies’ debuts. The number of people using currencies as a medium of exchange keeps rising daily. Call it merchants’ curiosity, but the future is sure that Bitcoin users will increase and gain more value.
The dollar and other strong currencies like the Euro and the Sterling Pound may continue to lose against Bitcoin, but no one can predict what will happen. It could turn otherwise, but Zhao doesn’t see that happening any time soon. The Blockchain, for an instant, is the reason why cryptos’ value keeps on rising. The instant settlement is baiting enough as users need a smart device and an internet connection.
Mr. Zhao added that the currency is much better on different anteriors. Governments cannot snatch it from users since it is virtual, a reason why merchants prefer it. The use of cryptocurrency is also decentralized and fraud-proof. Besides accessibility through the internet, the ledger transactions are accurate and have identity theft features.
Many fraudsters in the world conduct illegal businesses in the world using cryptocurrency, which does not mean that its ban will stop such dealings. Similarly, many scammers use the dollar and other traditional currencies to reap people off cash, but that doesn’t give a base to make the tender illegal. That is equivalent to banning the internet and other media of communication because criminals are using them. Doing so will derail the economy. Similarly, banning cryptocurrencies will hurt the world economy.
India is one of the countries that has gone ahead to propose a law to ban crypto. The Indian government doesn’t know that Bitcoins and other cryptos do not hurt the local currency. The pending bill is one of the world’s strictest policies against cryptocurrencies and other forms of virtual currencies. It is set to criminalize mining, possession, issuance, trading, and transferring of any crypto-assets if it passes. The measure is parallel to a recent government agenda that calls for banning private virtual currencies such as Bitcoin and Ethereum. India’s cryptocurrency bill is seeking a framework to get an official digital currency for the country.
Zhao critiques such a move by governments to ban crypto, citing that it is equivalent to restricting citizens to use better tools. The crypto guru says that there is a better way to deal with the crypto risk in any country’s financial sector. One of those is to make the banks operate at a higher efficiency, better service, more freedom, and lower fees. That will allow people to use the various mediums of exchange that is more valuable and a better tool.
Mr. Zhao gives an example of Japan, which recognized Bitcoin as a legal tender in 2017. Japan is one of the biggest economies of the world and classifies cryptocurrency as an asset. It is a valid form of payment though not a recognized currency. With Bitcoin, you can buy from big brands like Bic Camera Electronics, Hackers Bar, Dot Raw, Youkizaki, Mint, and other places. Though India’s bill is still pending, the country is already considering experts’ advice by indicating that it will not shut all the windows for cryptocurrency.
The US is also running exchanges for IPOs. A variety of crypto exchanges include Bitcoin, Coinbase, Gemini, Kraken, Bittrex, and Changelly. Users can exchange the currency with US Dollars by pairing; however, the FinCen doesn’t consider the virtual currencies legal tender. It is treated as an asset and regulated by different agencies at the federal and state levels.
Though Zhao’s critiques are valid, the digital currency has remained the number one cause of weakening currencies in different countries. When major bankers like Barclays, Walmart, and Intel invested their money and time on promising high-value cryptos like Bitcoin and Ethereum, the local currencies’ value dropped. Some of the traditional notes of early adopters like Brazil, Colombia, Venezuela, and Turkey have depreciated significantly. In this case, it is suitable for governments to be cautious with the illiquidity and value volatility nature of virtual currencies as it can affect the fiat currency.
The use of cryptocurrencies began in 2009 when an anonymous person called Satoshi Nakamoto created Bitcoin. Though Cryptographer David Chaum had developed an eCash in 1983, the use of digital cash had not been executed. Satoshi’s creation of the Bitcoin shoved way for other cryptos, an eye-opener that different types of money can be used in transactions. Binance CEO Changpeng Zhao is optimistic that cryptocurrency is not going anywhere anytime soon. It will continue to enjoy its popularity among many merchants in the world.