Binance CEO Changpeng “CZ” Zhao envisions a future where decentralized finance (DeFi) surpasses centralized finance (CeFi) during the upcoming bull market.
Speaking on a live X Spaces event (formerly Twitter Spaces) on September 1, CZ expressed his optimism about DeFi’s trajectory.
He emphasized that an increasingly decentralized industry would be beneficial and indicated that DeFi’s trading volumes, currently comprising 5% to 10% of CeFi volumes, could soon eclipse CeFi:
“Crypto’s future lies in DeFi; with its volume accounting for a significant portion of CeFi trading, the forthcoming bull run could potentially elevate DeFi beyond CeFi.”
In early June, following legal actions against centralized exchanges Coinbase and Binance by the U.S. Securities and Exchange Commission (SEC), the trading volume on the top three decentralized exchanges (DEXs) surged by 444% within 48 hours.
At present, DEXs exhibit a combined 24-hour trading volume of $722,776,226.
CZ also praised the recent dismissal of a lawsuit against decentralized protocol Uniswap. He found the outcome to be reasonable, logical, and positive.
On August 30, a U.S. federal court rejected a class-action lawsuit against Uniswap, highlighting that regulatory uncertainty impacts investor protection.
READ MORE; MakerDAO Co-Founder Proposes Solana Codebase for NewChain, Diverging from Ethereum Affiliation
The case centered on plaintiffs’ claims of losses due to scam tokens on the decentralized exchange.
During the event, a participant recalled a judge’s ruling that developers cannot be held accountable for misuse of DeFi platforms, a stance deemed favorable for DeFi builders. CZ concurred, asserting that code written by developers is a form of free speech and emphasized the significance of developer support.
Recent data suggests a shift in venture capital investments from CeFi to DeFi projects. A March 1 CoinGecko report revealed that investment firms directed $2.7 billion towards DeFi initiatives in 2022, marking a 190% increase from 2021.
Concurrently, investments in CeFi projects declined by 73% to $4.3 billion during the same period.
This trend potentially indicates DeFi’s emergence as the new high-growth domain within the crypto sector, while the waning investments in CeFi could be attributed to saturation.
Changpeng Zhao’s outlook on DeFi’s potential dominance in the forthcoming bull market resonates with the ongoing shifts in the crypto landscape, with decentralized finance poised to redefine the industry’s dynamics.
Other Stories:
Ripple Challenges SEC’s Appeal Bid, Asserting Insufficient Grounds in Ongoing Lawsuit
Warren Buffett’s Strategy vs. Bitcoin: Analyzing Performance and Potential in a Shifting Landscape
Former SEC Chair Expresses Confidence in Eventual Approval of Spot Bitcoin ETFs
