How does the “battle of the cryptocurrency giants” between CZ and SBF affect the future of exchanges?
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Was there a winner in the “battle of the giants”? In the book “Infinite Storm: The Rise and Fall Symphony of the FTX Empire,” which chronicles the story of FTX’s rise and fall, author Michael Louis writes that Binance is like the bully in class, while FTX’s unique ideas are like the weirdo.
Going back to 2021, the book states that at the time, SBF believed that obtaining a license and complying with regulations would eliminate non-compliant competitors, while Binance founder Zhao Changpeng, also known as CZ, turned a blind eye to new regulations. Winston, co-founder and revenue director of XREX, mentioned in this episode that the attitudes of these two individuals towards regulation are not completely opposing. In the battle between offense and defense in the market, the weirdo may indeed be a weirdo, but who the bully is remains debatable.
Winston believes, “The essence of the law is to restrict human behavior, while technology changes human behavior,” and regulatory risk is a challenge that the startup industry must bear.
With the establishment of the Virtual Currency Association, Taiwan officially entered the era of regulation in 2024. Winston, the vice chairman of the association, observed that regulatory agencies in Taiwan actually have a high level of understanding of the industry. “They (regulatory agencies) absorb new knowledge quickly, but they do not overly trust the industry.”
Overall development is like a short poem, although the speed may be a bit slow, it can develop steadily and leisurely.
In the era of regulation, centralized exchanges will gradually embrace regulation. Operators who are the first to comply with the rules and obtain licenses can build a “moat” in terms of business competition. On the other hand, regulation will also stimulate the rapid development of the “decentralized” market.
In this battle described as a “bully” versus a “weirdo,” there may not be a true loser or winner, and this kind of competition will continue to unfold.
Winston analyzes that in the end, the development of exchanges will see the coexistence of centralized and decentralized exchanges, each with its own characteristics and advantages. As we enter the era of Bitcoin for everyone, when everything has order and clear rules to follow, centralized exchanges will leave the wilderness era, and regular forces and large institutions will gradually enter, moving towards a more institutionalized direction.
Web3 Journey to the West
Hosted by Wayne Huang and Winston Xiao, co-founders of XREX Exchange, and Yoyo, Senior Director of Communications at XREX Group, they take you through the concept of decentralization and understand the Web3 world from various perspectives.
Summary of this episode:
In terms of compliance, what are the epoch-making implications and impacts of the different ideas of CZ and SBF in 2021?
Who is the “bully”? Who is the “weirdo”? It’s hard to say.
How is the relationship between operators and the government in terms of law restricting human behavior and technology changing human behavior?
Can “landing in various markets” build a competitive moat?
What is “regulatory risk”? How can exchange operators control it?
The great showdown between centralization and decentralization! What will the future of exchanges look like?
The first physical gathering of “Web3 Journey to the West” is coming! Open recruitment for the topics you most want to hear.
Co-produced by XREX Exchange and “WEB3+” under the “Digital Times,” the podcast program “Web3 Journey to the West” is about to reach its 50th episode!
“Web3 Journey to the West” will hold its first offline gathering in the fourth quarter of 2024. What topics would you like to hear the three hosts discuss live? What feedback would you like to give us? Please fill out the form below to let us know your thoughts.
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Music source
MusicbyAden – Earth
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Earth by MusicbyAden is licensed under CC BY-SA 4.0CC
Content of this episode is co-produced by XREX and “WEB3+.”
