Binance – the world’s largest digital currency trading platform by daily volume – and its founder Changpeng Zhao are calling for regulation to finally enter the crypto foray.
Changpeng Zhao Wants Regulation to Take Form
Regulation in the digital currency space has been one of the most controversial topics the blockchain world has ever seen. The idea of regulation is considered sacrilege to many diehard crypto fans given that the space was born out of a desire to operate outside the standard financial world. People wanted to be able to conduct themselves accordingly when it came to money. They wanted financial independence, and they didn’t want snoops and third parties anywhere near them.
However, as time has gone by, the call for regulation has gotten stronger given how large the space has gotten. This has led to widespread crime from hacks and thievery to money laundering, and governments around the world are wishing for customers to remain safe by implementing the right laws and legislation.
Now, it looks like Zhao has joined the call for regulation. In a recent interview, he stated:
This year, most of the regulators around the world are looking at crypto intently, and many of them are communicating with us, so we feel this is the right time. We feel that it is important for industry players to have a seat at the table, and we also feel that some regulations, if they’re made in a vacuum, may not have practical considerations in how they are applied, and they don’t get applied very well.
Zhao said that there were many reasons for regulation to be implemented, though he fully admitted that some were purely self-driven. He commented:
One of those minor reasons is a selfish reason: that in a regulated industry, the few larger players will remain. The smaller players do get cut off, which is unfortunate for those guys.
As it stands, several regulators in both the United States and abroad have referred to the crypto space as “the Wild West,” and say that unless appropriate rules are implemented, customers can never trade under safe conditions. Gary Gensler – current head of the Securities and Exchange Commission (SEC) – recently stated:
Right now, we just don’t have enough investor protection in crypto. This asset class is rife with fraud, scams, and abuse in certain applications. There’s a great deal of hype and spin about how crypto assets work. In many cases, investors can’t get rigorous, balanced, and complete information.
Build Your Business Before Worrying About the Rules
Gil Luria – a technology strategist at D.A. Davidson – likened the crypto space to companies like Uber and Lyft, saying they specifically waited until they got big enough to work on implementing the right rules and protections. He says:
They’re doing what Uber and Lyft did. Build a business ahead of regulations. When it gets to a certain scale, acknowledge that regulation will be helpful and then help shape it.