While 0-fee trading may seem ideal for Binance investors, wash trading may sprout in the process

Both traditional and crypto investors consider transaction fees to be one of the most important liabilities when investing through exchanges. So it comes as no surprise that Changpeng “CZ” Zhao, founder and CEO of Binance, asked investors about their interest in trading on the cryptocurrency exchange without There is a fee, the answer resoundingly yes despite the inherent risks this entrepreneur pointed out.

Binance users support 0-fee trading despite CZ’s wash trading concerns

Binance is the largest cryptocurrency exchange, surpassing nearest competitor FTX by 10 times in trading volume. Zhao, known for implementing features based on community feedback, reached out via Twitter to gauge investor sentiment regarding the complete removal of transaction fees.

While zero-fee trading seems ideal for investors, CZ pointed out a number of problems it can arise in the process – one of which is wash trading. Wash trading, in which users make a series of buy and sell transactions to manipulate market activity, can be used for VIP upgrades on Binance.

Furthermore, CZ stated that bringing zero-fee transactions to the masses would require Binance to implement a variety of safeguards, including detection tools to identify illegal transactions. Each VIP tier is tied to certain trading benefits including lower trading fees. As a result, professional poker player Brian Rast asked “So if there are no fees, why do you need VIP tiers?”

More than 30,600 investors have voted for the CZ poll at the time of writing – with about 65.5% tending to trade free. “Let’s see what the poll say. We listen to our users”, CZ is open to implementing the changes regardless of the challenges that a new system would bring.

Binance continues to grow its roots around the world as it regularly obtains registrations and operating licenses from regulatory authorities. Maintaining its expansion momentum, Binance’s Spanish subsidiary, Moon Tech Spain, was registered as a VASP by the Spanish central bank on Thursday.

“Effective regulation is essential for the widespread adoption of cryptocurrencies. We have invested significantly in compliance and introduced AMLD 5 and 6 compliant tools and policies to ensure that our platform remains the safest and most trustworthy in the industry”, CZ attributed the development to Binance’s intent to protect users.

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