Changpeng Zhao is a pragmatic and mysterious billionaire. He is Binance CEO and also the founder of Binance, which has become the world’s largest Crypto currency trading platform, up from a less-known company. However, Zhao has not given the impression of boasting or arrogance.
The Future of Blockchain According to the CEO of the World’s Biggest Crypto Company
Instead, the man known as CZ is friendly and has quietly focused on building a blockchain empire which could reshape the world’s financial system.In an interview with Fortune Magazine, he shared some bold ideas about Binance and the future of cryptocurrencies.
According to Changpeng Zhao, most predictions about blockchain are wrong. Still, many people may be interested in what he thinks will happen next.
During the interview, Changpeng Zhao gave three insights. Here is a summary of his comments.
The Future is Decentralized, but it Will Take Some Time to Arrive
This week, Binance unveiled its first acquisition in the form of a trust wallet. TrustWallet is a wallet app and a browser for decentralized apps (dApp). For Binance, the move is a bet, because more people will start using decentralized services that provide more privacy without relying on servers controlled by any organization.
Over the past two years, there has been an explosion in dApps, for example, the collectibles site Crypto-Kitties, which are rarely used now, in part because the user interfaces are so hard to work with. CZ agrees with this.
Binance CEO said:“It’s still the very early stage in dApps. Most are just proof of concept or simple games, but this will be likely to change before long.” By 2020, he says, we will see a wider use of blockchain-based messaging, gaming, social networking and rating systems.The next stage, he predicts, will be e-commerce.
Meanwhile, Binance is moving forward，in a haste, to build a decentralized financial system.This is not a new idea — it was bitcoin’s original vision — but Binance has been taking radical steps to expand the currency. This includes working with the Malta country to establish a global decentralized community bank. Binance is building its own blockchain to facilitate decentralized encrypted currency trading, CZ says.
The Popular Blockchains are Under Threat
Currently, the Ethereum blockchain can be dominant in hosting dApps and defining standards, but powerful rivals such as Tezos, Eos and Dfinity believe that they can replace Ethereum by offering faster, more efficient deals. So who’s going to win?
Surprisingly, Binance CEO believes that the current competitors are not ready for the long term because they are too slow. While such criticism has long been aimed at Ethereum, CZ says that any blockchain designed for general intelligence contracts is not fast enough.Instead, he thinks the existing blockchain will cede the field to more professional ones.
Changpeng Zhao also cites new tools such as Komodo and Tendermint that can write blockchains for specific purposes, suggesting that the future will consist of many bespoke ledgers. His comments may suggest that blockchains will evolve as chips, where custom ASIC chips (” application-specific integrated circuits “) are beginning to dominate computing rather than general-purpose chips.
The Cryptocurrency Market is Big Enough to be Shared
Binance’s profits were between $500m and $1bn last year, CZ says, and he does not want to challenge Coinbase in places like the US.
He says: “In developed markets, there’s more money to be made but more regulation and it’s saturated with competition, we don’t want to compete with Coinbase and [Winkelvoss-owned] Gemini. The strategy there requires lots of lawyers and lobbying.”
He adds that he prefers to operate in places like Malta, where he can work directly with the head of the state to promote the idea of a decentralized financial system.
As well, Changpeng Zhao doesn’t see an Uber-Lyft style fight-to-the-death for market share. On the contrary, he says that Coinbase appreciates the basic work Binance has done in Malta, while Binance thanks Coinbase for helping U.S. lawmakers understand encryption. Thus, it can be seen that Binance’s relationship with Coinbase is very good.