Author: Joy, PANews
On July 17, Bloomberg Businessweek (Chinese version) issued a statement saying: "This magazine made a serious mistake in the 250th issue (July 6, 2022) and published a false and unfounded cover headline. This magazine mistakenly wrote "Zhao Changpeng's Ponzi Scheme". This magazine unreservedly retracts and retracts this offensive statement and apologizes to Mr. Zhao Changpeng and Binance."
Justice will only be late, but it will not be absent. After two years, CZ and Binance finally got an apology, and this happened to be the 7th anniversary of Binance. Like many times before, this time Binance took another step towards "destigmatizing" the industry.
Earlier, on the 7th anniversary, He Yi, the co-founder of Binance, who has always been known as the "chief customer service", confessed the secret of Binance's success in a celebration video: "The first point of Binance's success is the environment, that is, the times, and the second point is the harmony of people. Not only is the management team strong, but more importantly, our entire community has enough enthusiasm for the industry. It is the community and team of Binance that have jointly created Binance's success."
Binance is entering a new stage. This year has been exciting and intense. Binance has achieved development milestones and successfully passed the biggest "crisis moment" in its history.
Industry veterans tempered in crisis
A few days ago, Binance released its anniversary letter, which was the first anniversary celebration of Richard Teng since he took office as CEO in November last year.
“By general standards, companies that have been established for seven years are mostly still in the early stages of growth and are ambitious startups; but in the crypto asset industry, Binance has become an extremely experienced industry veteran that has survived and thrived through various development periods in this fastest-changing industry in history, as it has been established for seven years and has almost always maintained its leadership position during this period,” Richard wrote.
Binance, tempered in the crisis, is full of the resilience of a veteran.
In the past year, Binance's biggest crisis moment was undoubtedly the US regulatory stick. In the early morning of November 22 last year, the US Department of Justice held a press conference to announce the charges against Binance, and finally reached a settlement with a fine of US$4.3 billion. At the same time, CZ will also pay a fine of US$50 million and face imprisonment in the United States. What should be pointed out is that in the charges, Binance was not mentioned to have misappropriated user funds or manipulated the market, which also confirmed its previous commitment to user funds.
It can be said that CZ's "sacrifice" and active confession and imprisonment have secured the legal foundation for Binance's continued operation and long-term success. In May of this year, during a trial in the United States, the judge said that he had learned about CZ through 161 letters of appeal and believed that he had assumed extraordinary responsibilities. He ultimately rejected the 36-month sentence recommended by the Department of Justice and sentenced him to 4 months.
In the view of industry insiders, this is a strategic compromise by Binance in order to avoid being involved in any case. When the regulatory hammer officially lands, it will be able to continue to serve crypto users in the long term within clear regulatory boundaries in the future.
This time, Binance experienced crisis again but ultimately emerged victorious.
Today, Richard Teng, who is in charge of Binance, is also an experienced veteran. Before joining Binance, he worked at the Monetary Authority of Singapore for 13 years. In 2007, he served as the Chief Regulatory Officer of the Singapore Stock Exchange (SGX) for nearly 8 years, responsible for the formulation of rules, frameworks and policies for listing, trading and clearing. He then served as the head of the Financial Services Regulatory Authority of the Abu Dhabi Global Market for 6 years.
As Richard concluded, the past year has been a mixture of difficult challenges and exciting moments of success, and despite management changes, signs of renewed user confidence have been seen in strong capital inflows and soaring new registrations.
The choice of 210 million users, the original intention of "user-centric" remains unchanged
Not long ago in June, Binance announced that its registered users had reached 200 million.
How did these 200 million users come from? Let’s turn the clock back to 12:00 (Beijing time) on July 14, 2017. Binance trading platform was officially launched. A simple announcement of a few words with three exclamation marks, which may be the determination made by CZ at that time.
Then came various crises. Less than two months after its establishment, it encountered severe challenges from domestic regulation. Chinese ICO projects had to return funds to investors. Once the ban was issued, the prices of many ICO tokens plummeted. Several projects listed on Binance even fell below the issue price, and the project team did not have enough funds to repay investors. However, Binance made an amazing decision to compensate investors with $6 million, which accounted for 40% of its operating funds at the time.
“In terms of percentage, it was the largest expenditure in Binance’s history. At the time, we were just a two-month-old startup, not yet profitable, and still burning money on recruitment, purchasing servers, etc. But my only thought at the time was: protect users,” CZ recalled in his 6th anniversary message.
One month later, Binance had 120,000 users and started to make a profit. Two months later, on December 18, 2017, Binance became the world’s largest exchange by trading volume.
He Yi described his feelings over the past seven years as walking cautiously through all kinds of storms. "Since the first day of Binance's launch, when BNB dropped 50%, we have been walking cautiously through all kinds of storms. We always believe that only by protecting users and being a fair and transparent platform can the entire industry have a broader path."
"User-centricity" is the most important consideration for all our decisions, and Richard also holds this belief. Now, just one month later, Binance's users have grown by 10 million to 210 million.
In the ever-changing crypto industry, it is like sailing on a sea full of undercurrents. Only by following the lighthouse can you reach the other side. For Binance, this lighthouse is the original intention of "user-centricity".
Binance’s annual report card
In addition to the 200 million registered user milestone, earlier this year, Binance surpassed $100 billion in user funds under custody for the first time.
To promote the popularization of crypto assets and financial inclusion, Binance continues to expand its product coverage, ensure accessibility to a wider range of crypto fields, and provide important financial services including MegaDrop and Web3 Wallet.
Binance also released a series of latest data for its seventh anniversary.
Currently, Binance supports 541 digital assets and 2,632 crypto asset trading pairs. The system already supports handling a large amount of user activity. The historical highest number of queries per second (QPS) on the Binance platform - a number that can be used to measure the number of users sending requests to the system and getting responses per second, is as high as 2.58 million. This number shows that Binance can smoothly handle very large loads when users need it most.
In terms of products, the Simple Earn product line allows users to add their crypto assets to 392 crypto assets, and has attracted more than 8 million users to experience Binance Financial Services. More than 24 million people around the world have used Binance Payment for secure and efficient domestic or cross-border transfers.
In terms of regulatory communication, Binance has obtained licenses and registrations in 18 jurisdictions, ranking first among all centralized crypto asset trading platforms. Between June 2023 and May 2024, the Binance team handled 62,800 law enforcement requests, bringing the total number of requests handled to 173,800.
In addition, in terms of user asset security, the SAFU fund size has always been maintained at more than $1 billion. At the beginning of this year, Binance exchanged all SAFU funds for more trusted and transparent stablecoin USDC, further enhancing the reliability of the fund pool and ensuring its value is stable at $1 billion.
The debate over coin listings: Binance takes the blame for the market
Recently, the biggest controversy surrounding Binance is that it has been accused of frequently listing new coins with large market capitalization, which has drained market liquidity, caused a recession in the altcoin market, and affected the altcoin market.
He Yi frequently responded to this question. In her opinion, these doubts are just opinions, not facts. From last year to this year, Binance has only listed about 30 coins, while some platforms in the market currently have at least 100 coins listed. The cryptocurrency market is a free market, and Binance's coin listing strategy does not affect the flow of funds. Trading volume and liquidity will be distributed throughout the industry, including between centralized exchanges (CEX) and decentralized exchanges (DEX).
“This so-called bull market is not driven by innovation, nor by major changes in the industry. In fact, it is driven by independent events such as ETFs.” Undoubtedly, in the PVP model with a lack of new funds entering the market and tight liquidity, the big fish eat the small fish, and retail investors who have not made any money can only vent their emotions on Binance.
Returning to the original function of the trading platform, it is to provide relatively popular and high-quality assets on the market. This process tests the asset identification level of the exchange. He Yi also admitted that there are indeed contradictions in the process of listing coins. Any policy has loopholes. The overall process is a battle of wits and courage. In the future, Binance's coin listing and investment incubation hope to allow more blockchains to be used by entrepreneurs, rather than welding users to airdrops and trading scenarios.
"We hope to screen out those project parties that run away after three days of work, and screen out those project parties that have the opportunity to succeed or have the opportunity to survive longer." He Yi said, a journey of a thousand miles begins with a single step.
In addition, high-market-value projects supported by VCs also need to be viewed dialectically. Project parties that receive large amounts of VC financing have a greater chance of surviving the bubble cycle, but the fundamentals of the coin price and governance model are determined by the project party. There is no standard answer, and a more in-depth analysis of project tokens is needed.
Binance also continues to clean up zombie tokens or problematic projects. It regularly reviews the tokens that have been launched, focusing on indicators such as whether there is continuous development, liquidity, negative information, etc. Tokens with higher risks will be labeled as monitoring. The audit not only looks at social media activity, but also liquidity, development progress and regulatory requirements. On July 8, Binance took down the trading pairs of four tokens: BarnBridge (BOND), Dock (DOCK), Mdex (MDX) and Polkastarter (POLS).
With great power comes great responsibility. Whether you like Binance or not, you have to admit that this world's number one crypto exchange, with more than 200 million users' expectations, has set an example for the industry.
Finally, I wish Binance a happy seventh anniversary.
