Changpeng Zhao admitted that the decentralized trading model had brought them regulatory challenges. He also highlighted his vision of institutional adoption and CBDCs.
Binance, the largest cryptocurrency exchange by trading volume worldwide, is getting ready to move away from its decentralized headquarters concept to satisfy regulators.
In a recent interview, Binance CEO Changpeng Zhao recognized the company’s need for a centralized headquarters to keep regulators happy on a global scale.
Zhao spoke during a South China Morning Post television show, where he explained how the exchange is preparing to implement the required licenses in jurisdictions to have better-licensing regimes.
The CEO then acknowledged that Binance’s discourse in recent years about its global and decentralized operation without headquarters had not gone over well with regulators.
Binance Would Establish a Headquarters
The CEO added that the company needs to have clear records of stakeholder ownership and risk controls. Zhao comes amid a lot of controversy for the exchange, which has received regulatory warnings from multiple jurisdictions, including the United States of America, the United Kingdom, and European Union countries.
Zhao commented that there are simple questions that regulators generally ask Binance. Regulators ask where their headquarters might be based. Zhao answers that they do not currently have some type of headquarter. These regulators don’t know how to work with Binance.
While the CEO did not provide further details on where they could locate their headquarters or when they intend to make these changes, he assured that the exchange is currently working to solve this situation.
Financial Institutions are Coming to Bitcoin
Beyond the regulatory issue, the founder and CEO of Binance also explained his views on the latest trends in the crypto space. During the interview, Zhao highlighted that large financial institutions have begun to realize the advantages of cryptocurrencies and are choosing to adopt these assets, with Bitcoin being the main interest.
The Binance executive also defended Bitcoin. He said that it is not just a coin but also a multi-set class technology and a new platform, and for that reason, many of the leading financial institutions describe it as an investment instrument. He also added that, according to him, digital currencies would play a relevant role shortly.
Along these lines, Zhao shared his perspective on CBDCs or central bank digital currencies. He indicated that these could have vital disadvantages such as limited freedom and government control.
Zhao explained that one of the main advantages of CBDCs is that they will educate people and users about cryptocurrencies, driving their subsequent adoption.
The CEO highlighted that once people use CBDC to pay for simple things, they can also say that such an operation is very similar to bitcoin, so they could also use Bitcoin to pay debts or make purchases in another country.
By: Jenson Nuñez