In the words of Changpeng Zhao, “I think given the current pressure and current stances taken by the regulators on the US Dollar based stablecoins, I think that as you said the industry will probably move away to non US dollar based stablecoins.”
Changpeng Zhao, the CEO of Binance, stated that pressure from regulators may shrink the USD stablecoin market and cause the crypto industry to move over to non-USD stablecoins.
In a recent Twitter space AMA, CZ claimed that USD-backed stablecoins remain popular as most people use US Dollars when calculating their ROI.
According to him, the recent crackdown by regulators may cause industry players to seek other alternatives. These include stablecoins backed by Euro (EUR), Yen (JYP), or Singapore Dollar (SGD).
“We probably will see more euro based or other Japanese yen, Singapore dollar based stablecoins, so it's actually prompted us to look for more options in different places.”
The CEO of Binance also noted that the crypto industry may use algorithmic stablecoins in the future. He cautioned that these tokens have inherent risks that need to be disclosed. Referring to collapse of TerraUSD (UST) in 2022, he added that the reserves for algorithmic stablecoins should be managed transparently.
Earlier, reports emerged that Circle, the issuer of USD Coin (USDC), had tipped regulators about Binance’s reserves. However, CZ voiced his disagreement with the rumors. He added that Circle would also hurt itself if it filed a complaint against Binance.
Zhao stressed that even though Binance USD (BUSD) has Binance’s brand, the stablecoin is not issued by the exchange.
Written by
Ayush Pande
Ayush Pande is a hardware, gaming, and crypto writer based in India. He's a tech enthusiast who's fascinated by the potential of blockchain technology.
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