Binance CEO Changpeng Zhao Bets Big on DeFi | Coinspeaker

Binance CEO Changpeng Zhao Bets Big on DeFi

Bhushan Akolkar By Bhushan Akolkar Updated 3 min read
Binance CEO Changpeng Zhao Bets Big on DeFi
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Binance CEO called DeFi one of the most innovative spaces in the FinTech market, however, added that it is relatively a very new sector and investors should weigh the risks as many DeFi projects are likely to fail.

Decentralized Finance (DeFi) is one of the fastest-growing sectors of the FinTech industry. Over the last few weeks, the DeFi activity on the Ethereum blockchain has surged massively. Besides, the exploding price value of cryptocurrencies like Chainlink (LINK) has pushed the DeFi market cap over $15 billion. Recently, Changpeng Zhao, CEO of crypto exchange Binance, also showered praises for the DeFi sector.

In an interview with the Boxmining Youtube channel, CZ said that DeFi is an innovative space and makes the crypto market even more attractive. He also talked about Automatic Market Makers (AMM) and called it a fascinating invention. CZ said:

“I think DeFi is a really innovative space and I think that’s really good. Initially, when people talk about DeFi they think about lending so you can lend your coins but now, you lend the coins to provide liquidity. When the liquidity is good, people trade more and trade more easily. I think automatic market makers are an interesting invention and it’s really simple. That aspect of it will stay.”

CZ added that DeFi is relatively a new field currently and we are in the early stage of growth. Thus, he asks investors to keep modest expectations as many projects are likely to fail. “I want to say most projects in DeFi will fail; it does not mean DeFi is not good, but that only a few will succeed. The few that succeed will succeed wildly,” he said.

Binance Is Investing in DeFi

CZ admitted that his own crypto exchange Binance is investing in DeFi and doing many projects around it. Besides, Binance is also listing many DeFi tokens on the platform. But CZ added that most users still prefer a centralized exchange and Binance will keep listening to the masses’ demands. He said:

“I think we go by user numbers to see what they want to use and push it. Today the majority of users still choose a centralized exchange because it’s much easier to deal with an email and password and have customer support than saying do a backup of your own keys and if you lose it you’re screwed. I do think in the figure if we can make the secure backup easier and useable, I think DEX is going to be the future. So we will continue to invest in the DEX and also form multiple projects. Right now, centralized exchanges are more popular by user numbers and we just want to provide products that people use.”

Apart from DeFi CZ also spoke about the developments of the Binance Smart Chain. Binance is working on improving the chain efficiency to handle around 100,000 orders per day. Binance Smart Chain is a parallel chain that supports smart contracts compatible with the Ethereum blockchain network.

Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.

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Bhushan Akolkar

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

Bhushan Akolkar on X

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