ETFs and Real-World Assets to Fuel Next Wave

• CZ says tokenization and Bitcoin treasuries could unlock trillions in capital for crypto.
• He urges Hong Kong to broaden crypto trading options and act faster on regulation.
• Risks remain as volatility and cautious regulatory approaches challenge growth.

Binance founder Changpeng “CZ” Zhao said tokenization and public-company Bitcoin treasuries are creating new opportunities for the crypto industry. Meanwhile, he warned that risks remain. 

Speaking at the Bitcoin Asia Conference, CZ said the expansion of exchange-traded funds (ETFs) and tokenized real-world assets could unlock “trillions of dollars” from global equity markets.

“Equity markets now have access to crypto, and we’re bringing real-world assets into crypto. This is fantastic,” Zhao said. He pointed to tokenization of U.S. Treasury bills, real estate, commodities, and even income streams as examples of how capital is flowing into the sector.

Related: CZ Says Governments Are Buying Bitcoin as Breakout Signals Major Rally Ahead

Similarly, Zhao believes Bitcoin could eventually become the world’s reserve currency. He cited its transparency, security, and increasing adoption as signs of its growing importance in international finance and its potential to transform the global financial landscape.

At the same time, Zhao warned that companies holding large crypto treasuries could struggle in future downturns. He also cautioned that newly issued tokens are prone to higher volatility, posing risks for investors.

Hong Kong’s Role as a Potential Hub

In a separate interview with the South China Morning Post, Zhao said Hong Kong has the right conditions to become a global hub for virtual assets, rivaling the United States and the United Arab Emirates. He stressed that regulators in the city need to move quickly to realize this potential.

“We shouldn’t evaluate a place’s future potential based on its current status,” Zhao said. “We should assess it based on the speed of change.”

Zhao called on Hong Kong regulators to expand the list of cryptocurrencies allowed on licensed exchanges. Currently, only Bitcoin, Ethereum, Avalanche, and Chainlink are permitted. He suggested adopting a model like Japan’s, which lets exchanges decide which tokens can be listed.

Conservative Regulation and Stablecoins

Zhao described Hong Kong’s framework as conservative, noting authorities “don’t want to make any mistakes”. The city introduced strict rules on stablecoins this month, requiring stringent reserve management, client identification, and anti-money laundering measures.

He said the cautious stance was reasonable given the shift from no regulation to regulation, though it has dampened some of the early enthusiasm around stablecoins.

Despite regulatory hurdles, Zhao remains optimistic about blockchain and crypto adoption. He compared the industry’s current stage to internet use in 2000, predicting explosive growth as artificial intelligence tools integrate with blockchain systems.

Related: “I’m a Foreign Citizen”: CZ Fights Back Against $1.76 Billion FTX Clawback Case

Zhao, who stepped down as Binance CEO in 2023 after pleading guilty to money laundering charges in the U.S., continues to advise regulators and support the BNB Chain network. He said blockchain adoption is still in its “infancy” and urged governments like Hong Kong’s to move swiftly to capture growth opportunities.