Binance CEO CZ ‘Banks are a risk to fiat-backed stable coins’ in reaction to SVB, USDC Depegging

Binance, on the other hand, is not the only company looking to move to traditional finance. Kraken has also announced its intention to open a bank.

READ MORE: Kraken Eyes Its Banks Amid Regulatory Scrutiny

The demise of FTX has increased scrutiny of crypto-friendly banks, and the recent failures of SVB and Silvergate have added pressure on these institutions.

CZ supports more stablecoins.

The Binance CEO also tweeted his support for other stablecoins in the broader ecosystem. He noted that Binance recently added a large number of his pairs of stablecoins.

Always supports multiple stablecoins. More coming. https://t.co/5W1mHzOjoG

— CZ🔶 Binance (@cz_binance) March 11, 2023

CZ also speculates that, like Signature, “it feels like there is a concerted effort to close crypto-friendly banks.”

“Banks are fiat-backed stablecoin discs,” he added in a follow-up. Tweet.

Recent failures of crypto-friendly banks such as SVB and Silvergate further underscore the need for stablecoins to hedge traditional financial risks.

CZ’s statements and actions suggest that it is aware of the potential risks of stablecoins that exist within traditional finance, and that they are against other stablecoins and the broader stablecoin ecosystem. His doubling and support shows that he sees stablecoins as valuable assets and should be defended against traditional finance. Some industries have a vested interest in seeing entities like stablecoins fail.

What is clear is that the cryptocurrency industry continues to evolve, merging or collapsing with traditional finance. As such, stablecoins will play an increasingly important role in whatever the future dynamics of crypto likely look like.

Please note that not all stablecoins are created equal and some may be more susceptible to certain risks than others. Additionally, many stablecoin issuers are working to address these risks and improve industry transparency and oversight.