Crypto space requires transparent and durable regulations: Changpeng Zhao
The cryptocurrency space requires transparent and durable regulations, according to Binance CEO Changpeng Zhao. He said this to a crowd of G20 leaders at the summit in Bali. CZ says;
“This is a new industry and we’ve seen in the past week that things can go crazy. Regulations are necessary to ensure everything is done properly, securely, and efficiently.”
CZ says that those with a vested interest in the cryptocurrency industry need to work together to protect consumers. He adds that;
“It’s not only regulators who have a responsibility to protect consumers. The industry as a whole share this burden.”
His comment comes a few days after the collapse of FTX, one of the leading cryptocurrency exchanges in the world. According to reports, the platform lost millions of dollars after a hacker attacked its database.
FTX says it has suffered an estimated loss of $8 million worth of bitcoin in one week. The company further acknowledged that there is no guarantee that hackers will not breach its system or database in future.
The platform later apologized for the hack and assured users, that it has since established new security measures to prevent; any further attacks.
Last week, FTX exchange filed for bankruptcy after being met with great financial strife. The company’s struggles began when reports leaked that it was loaning customer money to Alameda Research, who then invests the funds.
FTX’s actions were against its terms, so users withdrew their money from the site. The exchange wasn’t able to fill all orders and had to temporarily stop allowing withdrawals. The firm’s bankruptcy filing at the end of the week resulted in one of the biggest market crashes in history.
Several experts have been calling for the regulation of cryptocurrencies. They argue that regulating the market would eliminate bad actors. In August, Sasha Ivanov, founder and CEO of the Waves smart contract blockchain, says;
Despite crypto markets being rooted in manipulation, there’s still a lot of potential for investment and growth. Regulation will clean up the market so that people with large balances and high levels of intelligence can’t take advantage of retail traders. In the meantime, we have been working on our solutions, such as the upcoming launch of PowerDAO to help us regulate our ecosystem.
Across the globe, nations are trying to figure out how to best manage cryptocurrencies and support inventive ideas in the same area.
China has notably banned ICOs and cryptocurrency exchanges, but that hasn’t stopped it from embracing blockchain. Hong Kong, however, has decided to go in the opposite direction.
Earlier this year, China ordered a complete ban on all ICOs (initial coin offerings). Citing risks associated with speculation and money laundering as the major motivation behind this decision.
A few months later, it went on to ban cryptocurrency exchanges as well to curb the increasing trend of crypto-fiat trading; within China’s borders.
However, China has not given up entirely on the crypto dream and is focusing its efforts elsewhere. By exploring ways to use blockchain technology for a wide variety of applications.
The future of cryptocurrencies
CZ was speaking to CNBC on the sidelines of the Wuzhen World Internet Conference in China. And he discussed how cryptocurrency regulations in China have evolved:
“China is pretty good. In some ways, they are ahead of a lot of places like the U.S. I think it’s because China is trying to get rid of corruption and for government and regulators, blockchain technology helps with that. China has a regulator – an organization called the Cyberspace Administration of China. They take care of the internet space in a lot of ways and they are very active on potentially regulating or even banning crypto trading.”