Binance is looking to expand its empire: this time in traditional banking
Binance is looking to expand its empire: this time in traditional banking
Binance has made significant investments in the growth of the crypto
industry, but its integration into the banking system is imminent.
Binance takes on traditional finance
CZ didn't elaborate on what the company's next steps would be, but he did mention that Binance is working to provide support for those more accustomed to traditional finance.
There are people who hold certain types of local licenses, traditional banks, payment service providers, even banks. We are looking at these things.
There has actually been a crypto transition movement within financial institutions, in which major banks are either looking to incorporate crypto services into their offering listings or be open to talking about this potential.
It is obvious that the accumulation of interest focuses only on meeting the growing demand of customers.
However, considering that the world is facing an economic downturn, what the banks are doing shows their serious intention toward the fledgling sector.
So why not repeat the steps in reverse; this time, we might see the crypto giant get its own bank.
Big investments
Binance's founder said last month that the crypto exchange plans to complete the $1 billion investment in these transactions before the end of the year. CZ recently contributed $500 million to Elon Musk's takeover of Twitter.
The company has also invested more than $300 million since the start of the year. Binance's intentions instantly had a big impact, but it's not the first crypto entity to explore the benefits of acquiring a bank.
Nexo, a Switzerland-based crypto lender, announced in September that it had acquired a minor stake in Hulett Bancorp, the banking holding company behind Summit National Bank.
Binance could follow suit or go beyond. The strategy will not only help the stock market discover revenue opportunities but also help banks gain equity market advantages.
Zhao mentioned that when the cryptocurrency exchange collaborates with a bank, Binance often ends up directing a large number of new users to them, which increases the price of the bank.
"What we've found is that when banks work with us, we attract so many users to them, so the valuation of the bank goes up exponentially, like why don't we just invest in them too, so that we capture some of the equity upsides,” he said.
View CZ on CBDCs
Unlike his previous skepticism of CBDCs, CZ's view on the national digital currency has changed. The billionaire told the summit conference that he does not see the CBDC as a threat to cryptocurrency.
CZ recently announced in a tweet that Binance and the Central Bank of Kazakhstan are working on integrating Central Banking Digital Currency (CBDC) with BNB Chain.
The move came after the crypto exchange gained approval from Kazakhstan to operate as a platform for digital assets and to offer custodial services.
CBDCs will make it possible to carry out transactions, whether domestic or international, in a way that is both more secure and more efficient, at a lower cost.
Although CBDCs are still a fairly new idea, many central banks around the world have shown interest in them and are considering using CBDCs on a larger scale.
The progression of CBDCs is accelerating thanks to the robust development of a large number of wholesale and retail operations.
More than 88% of CBDC projects that are currently in the testing or production phase use blockchain technology to take advantage of some of the most important advantages offered by this technology, including high levels of security and transparency, as well as a diverse range of programming options.
