Changpeng Zhao, the CEO of the world’s largest crypto exchange Binance, better known to the community as CZ, believes the crypto industry is in a better place than in 2018.
At the Binance Blockchain Week conference held in Singapore this month, CZ stated that despite the 80 percent decline in the valuation of cryptocurrencies, the industry remains strong in many areas.
“I personally think the crypto space today is actually much healthier than it was a year ago. So we’re actually much healthier than ever,” CZ said.
Why CZ Remains Optimistic in the Strength of the Crypto Sector
Throughout the past 12 months, the valuation of most blockchain projects and tokens has dropped by around 90 percent against the U.S. dollar on average.
Major companies in the likes of ConsenSys and Bitmain have laid off a small portion of their workforce to realign their vision and to refocus on the core group of products to aggressively push to the mainstream.
Speaking to Boxmining at the Binance Blockchain Week, CZ stated that the year-long bear market has allowed the market to achieve a more reasonable valuation, providing investors with better opportunities to invest.
Last year, many blockchain projects, often without working products and active user bases, achieved valuations that easily surpassed hundreds of millions of dollars. As of January 2019, as shown in the data provided by ATHCoinIndex, the valuation of tokens has declined by a large margin in a relatively short period of time.
Source: ATHCoinIndex.comCZ said:
“There are tons of good opportunities to invest now. Contrary to at the all-time high, there were tons of bad opportunities to invest and people invest in those. I think, today, right now, there are tons of really good opportunities, the valuations are good, we see now the developers that are still building today, they have really good projects.”
Earlier this month, U.S.-based investment and recruiting firm Maco.la principal advisor Sheri Kaiserman echoed a similar sentiment as CZ during an interview with Bloomberg, noting that the drop in the valuation of infrastructure building companies and blockchain protocols has provided investment firms with decent acquisition opportunities.
“We felt like the best way to make money is to buy the infrastructure companies — the picks and shovels — that are helping build the foundation. They are coming down in valuation, which is the best part of the crypto winter for us,” said Kaiserman.
The price trend of major crypto assets such as Bitcoin and Ethereum arguably does not serve as an accurate depiction the current state of the cryptocurrency sector. Leading financial institutions in the likes of Nasdaq and ICE are continuously leading investments in the industry and the overall interest in the cryptocurrency market has not substantially dropped.
Builders and developers are still allocating resources to strengthen the infrastructure supporting the asset class and newcomers are actively attending meetups and conferences to understand the structure, usability, and potential of cryptocurrencies.
Emphasizing the strength in several key areas of the cryptocurrency sector, CZ stated:
“Right now, there’s like a conference every day. The number of people going to conferences and the number of people working in this industry are increasing. So the industry is still going very strong. Even though the price [of crypto] has dropped a little bit since last year but if you look at two years past, if you look at more than two years ago, two years it was like $300 for Bitcoin. Today is $3,000, it’s not too bad at all.”
How Binance Will Move Forward in 2019
Throughout 2019, Binance is expected to push its plans to launch five to ten fiat on-ramps or fiat-to-crypto exchanges.
This month, Binance launched Binance Jersey, a European fiat-to-crypto trading platform that supports the British pound and the euro.
https://t.co/THxfdd3RD2 is overwhelmed with registrations. There is a backlog of KYC verifications already. More resources are allocated to reduce it. In the mean time, we appreciate your understanding and patience. The registration prize is FIFO based, no worries. Just crazy!
— CZ Binance (@cz_binance) January 17, 2019
According to CZ and the Binance team, the demand for Binance Jersey has been overwhelming with record high registrations.
“So far, the Jersey market is overwhelmed with demand. That shows there’s plenty of demand there. Right now, the way I view it is that most of the money is still in fiat, it’s still much larger than the crypto market cap. So we need to get fiat coming in. On the other side of it, we are working on the decentralized exchange so the Binance DEX will come out soon,” added CZ.
The continuous efforts from leading companies within the cryptocurrency sector and major conglomerates in the traditional finance sector to bridge the gap between crypto and the mainstream may lead to an increase in awareness and overall adoption of the asset class.
Photo by Pablo Heimplatz on Unsplash