Written by: Jasmine

Editor: Wen Dao

Binance, the world's largest cryptocurrency exchange, sees the number of registered users exceeding 200 million as an important milestone. It took Binance more than four years to grow from 0 to 100 million users, and two years to grow from 100 million to 200 million.

The past two years have also been a period in which the entire crypto asset market has gradually recovered after entering a bear market. Binance was in the midst of this and had survived the “avalanche” with prudent financial management, but later encountered the biggest regulatory crisis since its establishment.

However, this giant seems to be able to rush out of the crisis every time. Last time, it relied on migration and innovation; this time, it relies on safety and cooperation. The captain "changed" and the strategy was different, but the principle remained the same. They all repeatedly emphasized "passengers first".

If you review Binance's product iterations over the years, it is not difficult to find that from 2018 to 2021 were the four years in which it enriched its products the fastest as a trading platform; starting from 2022, user voice and asset security have become more obvious product features, and Binance has also formed its own unique ecology relying on the accumulation of product layout.

After June 2024, when Binance passes the 200 million user milestone, "user first" will still be the keyword that its leaders will mention every time, in addition to "cooperation with regulators" which will be deepened from the lessons learned.

The new information comes from Binance co-founder He Yi, who used the phrase "be useful to the world" to reveal the key to Binance's new goal of "1 billion users."

"Users first" makes Binance the world's number one

If placed in the sequence of Internet giants, "200 million users" is not eye-catching, but in the cryptocurrency market, this number is already 34% of the total population.

In January 2024, Crypto.com reported that the number of crypto asset holders worldwide reached 580 million. This means that by June of this year, Binance had captured 1/3 of the world’s crypto asset users, less than 7 years after its founding.

User growth curve in the past 4 years

In fact, the last two years are not the two years with the fastest growth in the number of Binance users. At the end of 2023, the growth rate was 32.8% compared with the same period, and 2021 was 400% compared with 2020. Of course, that was boosted by the last round of bull market.

On the contrary, the past two years have been a process of the crypto asset market going from cold to warm. During this cycle, Binance has survived unscathed, but also encountered the biggest hurdle since its establishment.

In the crypto winter of 2022, the once popular stablecoin project Terre (LUNA) collapsed, triggering a chain "avalanche", with the bankruptcy of institutions such as 3AC and Celsius, and the collapse of FTX, the world's second largest crypto asset platform. Entering 2023, the market is recovering, but industry supervision is tightening. After all, Binance failed to escape the harsh penalties imposed on it by the US Department of Justice and other regulatory authorities at the end of 2023.

In both major events, Binance’s former CEO Changpeng Zhao (CZ) has always emphasized “users first”. He once said that users are the strongest driving force for Binance’s innovation. This is actually the principle he has always adhered to since he founded Binance, and this principle has also been implemented as much as possible in the entire Binance product line.

Binance's product series before 2022 was almost built around what users needed. This was also the four years with the fastest product growth for Binance as a cryptocurrency trading platform.

From spot currency transactions that were not available on early crypto asset trading platforms to LaunchPad, which led the IEO concept; from spot leverage products to contract trading systems; from supporting BNBChain to become an independent community to empowering BNB HODLer airdrops. Among them, some are creative products that "others don't have, but I have", and some are "better than others" products that enrich user experience.

Binance has been listening to users for seven years, and trust has been built up through one thing after another.

In October 2017, Binance used its cash reserves to refund BNB to users, and one month later, it gained 120,000 early users. The "user first" principle released its energy for the first time.

Since then, CZ has insisted on regularly doing CEO "Ask and Answer" AMAs on various social media or offline events, answering users' concerns about products, trading rules, turmoil doubts and even personal life; co-founder He Yi simply transformed himself into the Chief Customer Service Officer to mingle with community users, tearing up rumors, and directly connecting users with the team to solve specific difficulties, including but not limited to recovering assets that were charged to the wrong address, intercepting assets stolen on the chain, etc.; today, the AMA tradition has also been retained by the new CEO Richard Teng.

In He Yi's words, Binance is an "obedient" trading platform. "'Obedient' here means that we will study the user's complaints and observe what is happening in the market. In this process, we are also constantly reflecting, but there is no black-and-white answer. Users scold us for launching too many projects on LaunchPool. We listen to their advice and will continue to raise the standards for selecting projects, observe what is happening in the market, and what else we can do."

In the past two years, Binance has not launched many new products, but one of its outstanding features is that it has become more obedient. Protecting user assets and iterating user experience have become a very important part of the product, including listing and delisting assets.

Before 2022, many community tokens were listed, which was a move that Binance had to follow under the competition in the exchange market. But this also seems to give a hint to the project market: community projects with a large enough voice and high on-chain activity can be listed on Binance.

As a result, a large number of false prosperity projects that created buzz and data appeared with the participation of LuMao Studio. Binance received feedback from users and began to upgrade its standards after research, removing projects with abnormal data fluctuations.

“Many project owners will come to Binance to argue fiercely when listing a coin.” He Yi believes that Binance should try its best to list coins accurately. “We try to remain objective and keep the listing and delisting process relatively rigorous.”

In 2022, Binance launched the Proof of Responsibility (PoR) system, allowing anyone to verify at any time whether user funds on the platform are held in reserve at a 1:1 ratio; in the same year, the "Product Feedback and Suggestions" platform was launched, and more than 21,000 suggestions were received within a year, of which hundreds were included in product iterations.

Binance CTO Rohit Wad calls the various communication activities organized around user suggestions "Binance Build". "Many detailed improvements will not appear in announcements or media, but will be updated due to user needs and feedback. Small and continuous improvements are an important force in building Binance."

In April this year, data from The Block Pro showed that among major centralized cryptocurrency exchanges, Binance's spot market share exceeded 78%, and had been rising for three consecutive months, further widening its lead as the industry leader.

The reason why Binance can still grow despite the ups and downs is nothing more than the result of "putting user needs first". In other words, "user first" has made it the first.

Crossing the "200 million users" milestone, how can we reach the "1 billion" shore?

A company that is in a leading position in an industry is not only one that has an absolute dominant market share, but also one that will shoulder due industry responsibilities. As the saying goes, "With great power comes great responsibility."

Some actions taken by Binance and its leaders in the past two years show that it has increasingly discovered this: the more advantageous the competition is, the more it needs to hear criticism from the outside world.

This crypto giant did foresee the waves that its huge body would bring to the market in some industry events, as well as the backlash that might result from not paying enough attention.

In May 2022, when Luna and UST collapsed, Binance suspended trading of the two assets, but resumed it soon after, causing dissatisfaction among users.

In response to community questions, CZ mentioned that there are many other trading platforms in the decentralized field. "If we suspend trading, other trading platforms will experience price fluctuations. How do you think holders will feel?" He pointed out that Binance briefly suspended trading when the validator suspended block production. "Even so, this caused a lot of complaints, but our proactive actions forced the validator to restore the network within a few hours."

The "leader" flexed his muscles.

But later, CZ apologized to Binance for deleting a tweet due to a certain currency API data and for approving a certain voting event, saying, "Looking back, this was a mistake (the voting event)... We all make mistakes and learn from them."

"Leaders" are not always tough. They will bow their heads and admit their mistakes when they make them, just like a phrase that was often used when Binance was exposed for problems, "stand at attention and take the beating", and then "correct and correct the mistakes".

Binance's worst "beating" was, of course, the settlement with the Department of Justice in November 2023. For this, it paid a heavy price, admitted to violations and announced a settlement, paid a fine of $4.3 billion, CZ resigned, and its market share fell below 50% in a short period of time.

At that time, not only did BNB fall by 10%, but the entire crypto market experienced panic selling, which shows the impact of Binance's turmoil on the entire market.

However, this incident also solved an invisible "bomb" for the subsequent bull market development of the crypto market. Three months after the US regulators drove out the world's largest crypto asset trading platform, which was considered a "threat", from the country, the Bitcoin spot ETF was approved in the United States.

Binance's "admission of fault" has accelerated the bull process in early 2024 to a certain extent, and in turn paved the way for BNB to rebound above $600. BNB once broke through $700 in June this year.

After the regulatory incident, this trading platform has repeatedly emphasized the importance of "compliance", causing other platforms to pay more attention to their own operational risks in the US market.

In a recent AMA attended by He Yi, she once again talked about her attitude towards regulation when answering how to further increase Binance's growth. "If our industry really wants to serve 1 billion users, I think we still need to cooperate with regulators, build consensus and trust, and find a way to survive."

How to interact with regulation is an issue that a company that wants to thrive must face. This is what Web2 Internet companies around the world have gone through. Whether it is Google, Apple, Alibaba, or now OpenAI, they all need to pay attention to the regulatory responsibilities of governments to protect citizens and national interests. The blockchain-based, financial-related crypto asset industry is no exception.

As for the methodology of breaking the outside world's impression of the crypto industry and increasing the scale of the industry, Binance's own experience is "self-evolution until it is useful to society." This is almost the value that Binance has been practicing since it grew into the "world's largest" in the last bull market (2020-2021).

BNBChain gradually shifted from the transaction chain to the application chain, Binance Academy used rewards to help crypto novices get started with Crypto, Binance Square created a social platform for the crypto community, and Binance Charity injected crypto asset aid into various disaster events around the world...

Binance product performance and user numbers since its inception

As He Yi said, "As a more mature industry leader, we need to know how cryptocurrencies can help make the world a better place, how to better complement the existing financial system to make it more efficient, and how to better coexist peacefully with traditional finance."

Binance CEO Richard believes that in addition to regulation being the main theme in the current blockchain and cryptocurrency market, a new elimination cycle has also begun.

The high FDV projects that advocate Meme and oppose VC investment are an example. In He Yi’s opinion, this is a reflection of the fact that the market has not produced any useful projects for a long time.

She even specifically stated that "registered users do not equal active users, and registered users do not necessarily have trading behavior" to remind Binance that its current achievements are not that dazzling and the market potential is still huge.

A market size of 1 billion is the next goal that Binance hopes to reach, and He Yi has pointed out the direction for it and its peers, which is to "cross the chasm." She gave a more specific description, "Let blockchain become like the Internet, so that ordinary people can use it directly." In her opinion, by then, it will no longer be a challenge to expand the basic user base by 10 or 20 times.

(Disclaimer: Please strictly abide by the laws and regulations of your location. This article does not represent any investment advice)