Binance CEO Changpeng Zhao (CZ) has said Bitcoin’s success should not depend on bank failures.
“From the perspective of the cryptocurrency community, we should not rely on the failure of others for our success.”
inside Twitter AMAs, the question popped up about the failure of banks that benefit Bitcoin. CZ responded by stating that he believes banks and cryptocurrencies can coexist and are not a zero-sum game.
Furthermore, CZ dismisses the idea that a bank’s success or failure will have a meaningful impact on Bitcoin, stating that cryptocurrencies are one of many places to keep money outside of banks, such as real estate, stocks, or gold. I have made it clear that there is only one.
First Republic Bank
Regulators seized First Republic Bank, making it the second largest failure in US banking history, following the Washington Mutual collapse in September 2008.
the first republic $30 billion Eleven other banks lost lifelines in March, including Bank of America, Wells Fargo, Citigroup and JP Morgan. Since then, the Federal Deposit Insurance Corporation (FDIC) has been sounding alarms as it unsuccessfully tried to broker an acquisition in the meantime.
Following its collapse, JP Morgan has agreed to acquire certain businesses, including loans, securities and deposits, along with plans to convert existing branches into JP Morgan Wealth Centres.
Despite the warning signs of an industry under pressure, bank expert It calls the collapse of the First Republic a “belated reaction to March’s turmoil,” rather than the intensification seven weeks ago when Silicon Valley Bank, Signature Bank, and Silvergate Bank were buckled or seized.
Cryptography is not the only option
Giving his take on the matter, CZ said the banking industry is long established and prone to inefficiencies, suggesting that more bank failures are likely. It is also involved in bailouts, which motivates companies operating in this sector to take risks.
“I don’t blame the players, but we have to watch the game.”
Bitcoin exceeded $20,000 on March 11, when vulnerabilities such as the Silicon Valley bankruptcy were exposed, and reached a peak of $31,000 four weeks later.
The move is largely due to a shift in investor sentiment towards hard assets such as Bitcoin as supply is finite.
But CZ downplays the correlation, saying that different people prefer different types of assets. And given the variety of options for holding money, he doesn’t believe cryptocurrencies are the only option for those looking to take risk out of their banks.
“It’s not about when something takes a risk. People come straight to crypto. There are many other options in between.”
CZ said the growth of cryptocurrencies will come from improving their use and utility, rather than expecting the demise of traditional banks. He emphasized that it can be achieved by doing better than banks, such as trading.
