Changpeng Zhao’s Remarks on Bank Failures and Bitcoin’s Resilience Spark Controversy
On the evening of March 20th, Changpeng Zhao, the CEO of Binance, one of the largest cryptocurrency exchanges in the world, made some controversial comments about the banking industry on his Twitter account. According to his tweets, bank failures are simply a natural market culling, and regulators are trying to maintain these failed systems, which comes at a high cost to society.
Zhao also pointed out that every decade or so, the same banks fail, and instead of allowing them to disappear, they are kept alive at great cost to taxpayers. He further noted that it is difficult for new banks to enter the market and compete, and neo banks are often required to operate in the same way as old, failing banks. This, in his opinion, does not reflect a truly free market.
Every decade or so, the same banks fail. We keep them alive, then repeat. More costly each time.
Meanwhile, it is incredibly difficult for new banks (to be approved) to enter the market to compete. New banks are also required to operate in exactly the same way as the old… https://t.co/fQsF7ibMrT
— CZ 🔶 Binance (@cz_binance) March 20, 2023
These comments by Zhao came in response to a tweet by Gabor Gurbacs, the founder of PointsVilleApp, who criticized Credit Suisse early on March 21st. Zhao used this opportunity to point out that the CEO of Credit Suisse had once called Bitcoin a bubble when it was valued at $7,000. Today, Bitcoin is worth $28,000 and continues to thrive, despite the criticism it has received from traditional banking institutions.
Zhao’s comments have raised eyebrows in the banking industry, with many traditionalists taking offense at his remarks. However, it is important to note that cryptocurrency exchanges and the banking industry have long been at odds with each other, with cryptocurrency exchanges seeking to disrupt the traditional banking system.
In conclusion, Zhao’s comments may be controversial, but they highlight the growing divide between the traditional banking industry and the cryptocurrency world. As more people turn to cryptocurrency, it will be interesting to see how these two industries will coexist in the future.
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