Binance CZ Says Crypto is “Much Healthier” After $2 Trillion Correction

Changpeng Zhao (CZ), the founder and CEO of leading cryptocurrency exchange Binance, believes that the crypto industry is “much healthier” after the series of events that wiped nearly $2 trillion off the crypto market.

CZ: Crypto is Much Healthier

In a recent interview with CNBC, CZ noted that while the crash adversely affected investors, it helped cleanse the industry. 

“Given the Terra LUNA crash, it does hurt a lot of people. But then, it also weeds out a lot of the weak players in the industry. I actually think now the industry is much healthier than it was [six to nine months ago] when Bitcoin was $68,000,” he said.

Too Many Crypto Regulators in the U.S. 

The Binance CEO further spoke on crypto regulations in the United States. Zhao noted that the country has too many regulatory bodies, such as the Securities and Exchange Commission (SEC) and the Justice Department, trying to take charge of exercising authority in the crypto market. CZ believes such power struggles can cause several “problems in different ways.”

Unlike the tussle in the U.S., the crypto billionaire noted that other countries have singular authority assigned to matters involving cryptocurrencies. This allows these nations to embrace crypto regulations and not ban their use. 

Some of these countries include El Salvador and Central Africa, which have adopted Bitcoin as a legal tender. Other countries, such as Dubai, have rolled out regulatory frameworks that can drive the growth of the crypto market. CZ noted that such approaches are “very positive” for the industry. 

CZ: Investors Now Have Long-Term Goals 

Another factor CZ noted as the reason behind the strength of the crypto market was the fall of various crypto projects. This year saw several crypto companies, especially crypto lenders, go bankrupt. 

In May, the Terra algorithmic stablecoin UST lost its 1:1 peg to the U.S. dollar and subsequently crashed to zero, pulling the entire Terra ecosystem with it. Shortly after the dramatic crash of the network, CZ commented on the design flaw of the network, noting that the designers behind the tokenomics of the ecosystem need to have their heads checked.

Companies such as Three Arrows Capital and Anchor Protocol, which had exposure to Terra, were financially destabilized, and some have become insolvent.

Even with the fall of many crypto companies, CZ believes that other firms are coming up with new applications that can drive the adoption of cryptocurrencies. Additionally, investors now think of the long-run rather than short-term gains. 

“Now we see people who are building new applications are staying in the industry. The investors in the industry now have a long-term view. So I actually think that the industry is much healthier now than when it was at all-time high,” he said.