CZ's Bear Market Plans | LIVESTREAM

Transcript

hey bankless nation welcome to this special bonus episode and live stream we're super excited to bring you cz the founder and ceo of binance he's going to be on in just a second david this is perfect timing to bring cz on the podcast because we are in the depths of a bear market we want to pick his brain on that see what binance's bear market plans are about to be it's also his first time on the podcast so i'm super excited about that i don't have my regular setup david you can see the background behind me i'm in kind of like this this cave type area i had a power incident at home but i'm super excited to uh to live stream with you any any thoughts going into this one yeah ryan's setup is a bear market down bad but of course binance and cz have been through bear

markets before so we want to pick his brain about like some bear market wisdom and also see what binance is up to uh in this bear market uh cz is one of the few people in this current market environment and that is like cash positive uh and so like i want to see what is in cz's shopping cart so i'm going to ask him all these questions in just a hot sec we're going to bring cz on right after we get through some of these fantastic sponsors that make the show possible rocket pool is your decentralized ethereum staking protocol you can stake your eath in rocket pool and get our eth in return allowing you to stake your eath and use it in defy at the same time you can get four percent on your eth by staking it with rocketpool but you can get even more by

running a node rocketpool is the only staking provider that allows anyone to permissionlessly join their network of validating ethereum nodes setting up your rocketpool node is easier than running a node solo and you only need 16 eth to get started you're getting an extra 15 staking commission on the pooled eid that uses your note to stake you also get rpl token rewards on top so if you're bullish e-staking you can boost your yield by adding your node to the decentralized rocket pool network which currently has over 1 000 independent node operators it's yield farming but with ethereum nodes you can get started at rocketpool.net and you can also join the rocketpool community in their discord you can find me hanging out there sometimes in the chat so i'll see you there arbitram is an ethereum layer 2 scaling solution that is going to completely change how we use defy and

nfts some of the coolest new nft collections have chosen arbitrary as their home while d5 protocols continue to see increased liquidity and usage you can now bridge straight into arbitrarily for more than 10 different exchanges including binance ftx kuobi and crypto.com once on arbitrary you'll enjoy fast transactions with cheap fees allowing you to explore new frontiers of the crypto universe new to arbitrary for a limited time you can get arbitrary nfts designed by the famous artist ratwell and sugoi for joining the arbitrary odyssey the odyssey is an eight week long event where you complete on-chain activities and receive a free nft as a reward find out more by visiting the discord at discord dot gg arbitrage you can also bridge your assets to arbitrarium at bridge.arbitrum.io and access all of arbitrary's apps at

portal.arbitrum.one in order to experience defy and nfts the way it was always meant to be fast cheap secure and fiction free make your dow is the og d5 protocol the first d5 protocol to ever exist even before we called it d5 maker dow produces dye the industry's most battle tested and resilient stable coin using maker you don't need to sell your collateral if you need liquidity instead you can spin up a maker vault and use your collateral to mince die directly with maker the power to mince new money is in your hands and there's something new in the maker dow ecosystem every time a new maker dow is opened the owner can claim a po out which contributes funds to one tree planted an organization with ongoing global reforestation efforts creating a world where digital participation and the health of our environment can live side

by side soon maker will be present on all chains and layer twos bringing the biggest and best d5 credit facility to everywhere there is defy so follow maker on twitter maker dow and learn from the oldest and most resilient dow in existence all right guys we are back with this special bonus podcast i'm super excited about this one we've got cz on the podcast he is the ceo of binance also the founder of binance the world's largest crypto exchange cz welcome to bankless how are you doing my friend hey ryan david thank you for having me having me on the show it's great to be here uh well it's awesome to have you i got to start with this question because we are in a bear market this is all but confirmed we've got ether 80 off all-time highs bitcoin off 70 plus how are you guys holding up how's binance

holding up during the bear market so far um we're fine um we don't have any debts we don't owe anybody any money we're still profitable even today and um no but not that many people owe us money we have pretty good um debt control so um yeah um we're pretty good and um yeah so um as david said this is not the first time we've been through this one of these things and we even in the bull markets we have always had the mentality that bitcoin can go 80 down um over over a period of time and it may last for you know months or years so we're okay yeah what did you guys do differently because um some crypto companies i'd call them crypto banks maybe are not faring so well what was different about the

positioning of binance going into this um i think many of the fundamentally many companies when we in the broad market every com many companies just sort of expected that the board market will continue indefinitely markets don't do that market good bull bear pool bear just goes in cycles so we we understood that and we just held a very fairly large amount of cash reserves during the bull markets and uh luckily also for us our income comes into different cryptocurrencies and stablecoin is one of those uh like stable coins accounts to about 25 to 30 to 30 of our income so we're like we're relying heavily on that now so yeah i think overall we like i just did just because we're in a new industry we

are quite uh expectant of the uh cycles so just having that mindset really helps i think yeah certainly and and it's uh paying off very very much right now in in this bear market as i alluded to in the intro i think it's basically like binance and ftx that are the like well-capitalized players right now uh and like ftx is being pretty damn aggressive with like kind of the fire sales that are going on right now like block fly is having a fire sale at like a 25 million valuation and ftx is trying to get in on that i'm wondering like what is binance uh looking at like with all the uh having cash on hand is a very rare opportunity at this moment what opportunities in the crypto markets are

you really looking at at the moment yeah i think um so basically we're looking at like all the same opportunities come to all of us um in fact like we look at all the opportunities probably we probably have first picks um all of those opportunities um so we try to keep it we try to respect the confidentiality classes we have with our partners so that we don't really disclose ongoing deals um so if that if there's a deal in discussion we try not to disclose much of it and even even after it concludes we we still try to observe confidentiality aspects of it but the same deals that you see in the news that um other people look at we they they typically come to us first um so being the large i think i'm pretty confident we have the lar by far the

largest cash reserve right now um and most of this and so we do have first picks um and um but not all deals uh well we like we like to save the industry as much as possible but not all the not all projects are worth saving um if the projects are very badly run badly designed um other problems that are hard to fix then it's generally not good to put bad money after a good money after bad money right we you don't want to bail out companies that are mismanaged um so but we do want to help the majority of companies to uh uh that have a little bit of a liquidity crunch to go through this cycle and we're talking with yeah i'm 50 plus of them yeah

wow 50 plus of them i think like people are taking bets and who's going to bail out more of these crypto companies is sbf or cz i guess that uh remains to be seen i think we both have to do our part um whoever has cash right now should do their part um i think ftx is more u.s focused um sam is in the u.s all the time etc so uh um so and we're more globally uh distributed so we're but we're there's a large number of deals in the u.s and also during the last couple years there's a lot of lending protocols developed in the us um so quite a number of them are on the liquidity crunch so um there's more deals happening in the u.s but we're looking at that um but we're also looking at the world globally as well

but i think it's not one it's not us us versus them it's really like let's just do let's all do what we can yeah and what what are you um how are you hoping to position binance coming out of this so i mean bear markets if you can last if you can sustain through them this goes for a retail holder bankless listener uh if you sustain yourself through the bear market you come out stronger on the other side it also goes um the same principle applies to crypto companies and binance is no exception of course so you guys have an opportunity actually to get stronger during the bear market and to come back the next cycle even stronger in what ways would you like to position yourself during the bear market to come out stronger uh what do you kind of

what competencies are you developing what key areas are you planning to invest in sure i mean there's two aspects right so for um for industry players like ourselves now it's actually the best time to hire talent um so there's much more talent available in the pool now and also you don't have uh we have less other companies competing for the same talent with ridiculous um salaries compensation etc that didn't make sense i mean a year ago if a a university grad out of college if they knew solidity programming they can get an offer for half a million dollars a year i mean i think that's kind of you know that's a bit overboard to be honest so now we're seeing much more reasonable uh situations in the industry um we're looking at investing more um in

bear markets there will be more consolidation and the guys who have cash and the guys who are left standing who have very strong business models and strong products will benefit we actually will there will be more consolidation which means basically more market share more users the total number of users may stay the same or even drop a little bit because people uh some bear market push some of the people out but the um the market share increases and the positions the the influence increases when the next bull market come we're in a very good position to take advantage of that um and then the invest investments mna is all tied to that for retail investors the first thing of course is to survive so make sure that

you have enough money that your lifestyle is not impacted um the second thing if you have extra money um now it's actually not a bad time well different people use different strategies i don't want to recommend any specific strategy but some people like you know micro seller um or cyber or they're they're buying now so that the average cost actually comes down um and if they can last for a few uh uh through this beer beer market on the next bull market they'll have more holdings so now it's actually a a very cheap time to buy i uh well uh if we're in a bear market um i want to be careful uh giving financial devices not giving financial advices so but uh for retail investors uh it's the same like you know focus on my advice is always the same

focus on a small number of projects that you know well and if you know that the project is going to survive and you can tolerate the risk by all means um and but understand that tomorrow the market may go down even further um we don't it may go up you may go down nobody knows what's going to happen tomorrow but longer term horizon the industry is staying the industry is not going away there's more apps being developed there's more people in the industry so the industry is going to get bigger if we look at 5 10 20 year horizons cz you put out a tweet talking about how many positions that you're hiring at binance i want to actually go into that a little bit but but first before we do uh a little bit more on the bear market because like i said in the intro again

like you've been through bear markets before binance has been through bear markets before this is nothing new under the sun a lot of us have been through bear markets before and historically in the crypto space bear markets last about two two and a half years uh we have this like two year bull run we have this two year bear market and this thing just perpetuates however this time it does feel a little bit different we have like this macro story of just like there's there's war in in europe uh we have unprecedented inflation united states like we're super indebted the global war reserve currency is super indebted and so there's a lot of murmurings about like this time it might be different so i'm wondering how have you uh positioned binance and binance's cash position and your investments with this like uncertainty as to how long this bear

market really lasts like do you have an opinion about how long this bear market's going to be um i don't really have no opinion um it's very hard to predict the future but historically we've seen very accurate four-year cycles but there's also many things in the world that are four years the bitcoin having is every four years the united president's elections every four years um the stock markets go through a four-year cycle as well if you look if you look at it historically so uh it doesn't mean that the next cycle will be exactly four years but um i think there's a pretty decent probability that that might happen um and but if we look at all the other different things that you that you just mentioned that you said are different the inflation the war everything else

those things should really help the crypto industry those things which really push people to want the inflation should push people to want to hold a limited supply asset so um the war and the the the more the world is divided um the more that the bitcoin is a very global currency that actually shines um so the more the the more those issues happen um the more people should need well the advantages of crypto blockchain is actually more clear so um yeah to be honest to be very frank i was kind of surprised that bitcoin only made an all-time high at 68 000 i thought it was going to go much higher but again i was wrong so um i'm never good at predictions um but all

of those things in theory should help crypto but the fact that right now we're going through a winter is kind of surprising to me but again no one can predict markets i can't but logics do work in the long run so that's my experience what what what if cz um it takes a long time for crypto to repair right it's like as you said we're used to these like four year cycles and so i put out a tweet the other day and i just asked people um what do you guys think uh how much longer will the bear market go one year two years three years or five plus years right eighty percent of crypto twitter people said two years or less that's what everyone's expecting but as david was saying this

might not be the case this time what if we're in for and i'm optimistic that it is of course you know this is bankless we're perma bulls we're never going to be bearish on this space but um what if it lasts a bit longer what if we're talking about like four years five years and we're still not back to bitcoin and eath all-time highs um what happens to the industry does it wither away and die or are we gonna be okay i think we're gonna be totally okay um there are a group of people there are very large group of people that i know that it's not going away um so there are some you know new investors that get that gets you know shocked surprised fear and they they go away for a while but um pretty much of all the people i know who

are his who were here since 2017 those guys are going to stay and as as a business i would recommend most businesses have at least 10 years of wrong way 10 years of cash if they have zero income uh very few traditional companies can achieve that but in the blockchain world um it's actually not that hard to achieve um you know finance we have we have like the balance coin is about 40 billion dollars market cap we uh we have the team portion we never used and we do commit to you know burn that um and but we also have income like even the team portions was you know double digit billion dollars um so most crypto companies sit on this re if they manage wealth they could be sitting on this really large cash reserve

so um and and even if we don't touch that we actually still that aside we actually still have very healthy reserves that will last us many years so um they are and also in the business in the crypto business um they're very clear very simple business models um you should have revenue and um and because we're dealing with um crypto money um we're dealing with this industry it's actually not difficult for good businesses to make money so um i think just sustainability wise many businesses in this industry can sustain for very very long time um so um i'm not too worried about it cz i want to go back to that tweet where

you talked about how how we have 2 000 open positions at binance which is a crazy number we're seeing layoffs at coinbase we're seeing layoffs at blockfy but you're saying that binance has 2 000 open positions can you tell me a little bit more about like just the general sectors that these open positions are for like is there anything in specific that there's like out of maybe like maybe the world of staking and staking assets is really popular right now or there's like other protocol developments like in what areas are you hiring the most um i think like we're basically hiring across the entire spectrum of every position we have um that typically comes down to you know about half of the engineering positions and that's always the

one of the hardest places to hire luckily we can hire globally so we can tap into different timeline pools all around the globe which is fantastic um the second thing is uh in large number is customer support so as much ai we do as much automation we do we still actually do need quite a large number of people talking to people um so we're actually offering phone support in six languages now so people can call up people can in the app they can they can use they can do a voice call the other roles are the marketing legal compliance other back office roles there's many of them so we cover fairly wide spectrum we also are our heart um we also are in the technical side we're

also looking for different type of developers like mobile developers web developers blockchain developers all of this type of different roles so we actually see this as the best chance to hire people and then the people we hire today can can can scale our up our system so that when the next world market comes hopefully in a couple years or even maybe sooner we're ready so we always we always want to be ready for the next peak uh which is really important in our industry and how many people does binance employ currently because 2000 is a crazy number what number are you at currently we're just around 6000 right now so we want to get to about 8 000 before the end of the year that's the target amazing amazing and where does the revenue come to to support like so many

people at this company i think that makes you like the largest crypto company by far right i think today by employees we're probably we are the we should be the largest uh now um um our revenues are pretty simple we we try to we charge a fee when people trade and that's it that's the bulk of our revenue um we have some other stuff like you know we have m a which done pretty well uh we have um other staking et cetera we have like margin lending that generates a little bit of income but those are very tiny compared to the trading fees cz i got to bring uh this up because it was just uh hilarious with your tweet you had um this picture of yourself which is uh great and then kobe tweeted

out wait i just realized did you photoshop your own head on a stock photo of someone waiting to shake hands and i'm not even sure if you did or not but the fact that this photo exists is pretty hilarious and i uh really love your interplay on on crypto twitter but is this photo real or what is this photo this photo is a photoshop photo i thought it was crazy and uh i didn't photoshop it um i was like uh there was some discussion in our internal you know internal chat groups uh the previous photo was the us army hiring photo they also photo photoshop that photo and we're saying that that photo is like a couple years old and then one of the designers just posted this photo in the group in the internal

chat group i said them can i can i post it right now so i just took that photo um and just posted it and so yeah it was like very organic our team photoshopped this i didn't i thought it was pretty clear with you know no it it just like it almost could fit so if you're just a passerby you kind of see it and it takes a second look to be like oh my god this is a stock photo but this is part of what um i think people love about uh crypto and what i love about crypto is it doesn't take itself too seriously you know it's somewhat still uh irreverent and that's that's something that's special about this uh this industry um but i want to ask about you because you are you're definitely a figure at uh binance being sort of you

know the founder and the guy who gets photoshopped into meme stock photos and that sort of thing what are your plans are you going to like ever retire at some plate at some point or is this you know cc plus binance forever um okay so let me address the first part um first i think i love the meme culture in in the crypto space and i think one of the per one of my friend told me the best it says uh uh here cece look you you i like the fact that you take work very seriously but you don't take yourself very seriously so um i think that's the mentality i encourage people to adopt just no we're just normal guys um and a a designer photoshopping yourself your head onto something else et cetera if you just embrace it um and it's fun it's

like there's nothing nothing wrong with that for uh for myself um i do really want i do want to retire sooner or later um i've been ceo of finance for five years um i don't think a ceo should be uh should be longer than ten years um any i think any ceo that stays in one row for 10 years we get older we get more stale our thinking gets molded in a certain way the organization becomes more fixated on a certain structure which may or may which usually may be good for the company in the short term but long term i think companies these days should be more dynamic more adjustable and more changing fast fast changing with the times so i think somewhere between now

and five years later i should retire so we are looking at succession plans um how to train the next set of talent that's actually what i spend most of the time my time doing is dealing with the talent pool people training coaching making sure that we have the right organizational structure i actually don't do any specific operational stuff i look much more at the human side of things so uh i i i do think um ceo should not be more than 10 years so somewhere between five to 10 years is a perfect time for uh for ceo to transition out getting a new blood in and um so like when i transition out i may become a chairman for for a couple years and then retire completely um and then i'll be busy with other stuff um there's so many

so many other interesting stuff to do as well at what point uh what do you want binance to become when you know that it's ready for cz to take a step back like where is binance today and where does it need to be before you are comfortable giving the keys to the kingdom to somebody else what's left to do well so why not should become that should become should become in such a uh such a situation where he does not need me at all um and today i'm taking steps back and i'm taking more and more steps back i'm delegating a lot more so today the operations of finance i can go on vacation for like i can turn them i can turn it off my phone for like a week finance will be completely fine even months i think finance will complete will be completely fine

um there's some strategic decisions they still come to me and ask for my opinions i'm stepping further and further back i'm like like you guys decide you guys decide um those decisions should not be made by me so um and i think to be honest today finances is already very strong um i think even if i retire today it's not a probably not a big deal um a bonus will continue but i would like to see binance shape up as we're growing really really quickly our organizational structure is not very it's not very fixed in fact we are experimenting with a lot of different structures et cetera the structure inside binance is very dynamic um so i think you know in a couple of years binance will be at a point where binance does not need cz which is a

perfect place for binance to be and that's probably a play a time that i say hey look i can i can chill out and do other things um yeah and for binance but miners itself i think um this this i want to explain as well uh different companies in this industry are different it's clear that they have different goals finance wants to provide tools for people to access crypto so we want to be the infrastructure tools provider whereas other even other exchanges we can tell that you know they go into stock trading they just want to be a trading house they want they want they want to trade and they want to charge they want to they want to make money on commissions whereas we we have a lot of tools that have no revenue uh you know we have a decentralized wallet trust wallet um

zero zero income uh no revenue uh we have coin market cap they used to rely on advertising revenue we removed all advertising from coin market cap um so we just provide access to crypto information so we want to be the tools provider for crypto this is the reason why we're not we're not going to stocks we're not going to provide stocks trading tools we're in the web 3 crypto world so there are some subtle differences between different companies that at least from from my perspective i can see nothing wrong or right with any of the approaches but binance is more of a web street tools provider yeah okay that's interesting the visions we had um brian armstrong on the podcast um a few months ago we also had sbf we asked kind of similar questions of like what do you

want your companies to be when they grow up right and with when we were talking with brian there's kind of this dichotomy of um do do you want to be more like kind of a bank so are you trying to get um binance larger than uh jp morgan let's say i mean two 2.5 trillion in assets something like this or there's this other path because you're in web 3 you're in technology where you could become more like a a silicon valley um company like a facebook are you competing with the banks are you competing with like the facebooks and the silicon valley companies of the world is it a combination of both or is it something net new how would you answer that question but um cz yeah okay i think i think in short we definitely don't want to become a bank

that's very very clear and we actually also don't want to become facebook we don't want to hold people's cash uh money we also don't want to hold people's data um so you don't want to hold people's cash because you hold a lot of cash right now right today we do but i think if in five ten years uh this decentralized exchanges will be bigger than centralized exchanges so this is why we this is why we invest very heavily in blockchain development wallets trust wallet cross wallet isf pal we invested as well we invest in multiple wallets so i do believe that you know i would say maximum in 10 years uh texas d5 is going to be bigger than c5 so there's a world for binance where you guys still exist you're still a market leader but you have no custody

of of anyone's assets in private keys you're just kind of a conduit a brit like what does that look like i don't think it's like uh i think okay i think it would take a long time for the centralized exchanges to go to zero but i think it will take five i mean ten years this d5 is going to be bigger than decentralized exchange is going to be bigger than centralized ones but the centralized ones will continue to play a role for many decades to come i think because there's still many people who are much more comfortable using an email and password um if you like my per if you ask my parents generation they would much prefer that instead of using a usb stick to do encrypted backups of their private keys in a distributed manner all this other stuff but i think the technology will improve

to a point where the decentralized stuff will be much more usable it's actually easier to use because you don't have to do kyc you don't have to do ml all of these are very tedious processes that you can have on your own control of your wallet and also binance is not fixated on the centralized exchange um you know many so i didn't like um i typically don't use banks or facebook as analogies for companies that we want to mimic actually there's one other company i often do which is google so google provides a number of infrastructure services a number of tools for people to use the internet we do search email maps all this other stuff right many of them are kind of free not super free but you know

the web tools based ads model but google provides a number of tools for the for the web to for the web world we want to be the company that provides a number of tools in the web 3 world so it doesn't have to be the centralized exchange many many people thought of google as a as a search engine but google is way more than just a search engine um so um that's kind of how i visualize things and how i try to position binance um sort of a future future future direction one thing that's interesting is we had um vitalik on the podcast not too long ago and he was just coming back from a trip to argentina and he asked us the question he said guess the number one crypto app that people are using in argentina and we're like uh

i don't know you know is it tron what what is it uh finance that's what he said and i i think that people outside of the us don't um necessarily or you know outside of europe don't understand the breadth that binance actually has in particularly um the you know developing world uh and i i'm wondering if you can kind of comment on that and with the context of binance being kind of like google and in providing tools and services and like google provides you a way to index like see the internet search the internet what is what is binance providing say a a community or a country like argentina that they're not getting from their

existing financial infrastructure yeah so um yeah i think this is a very good point actually um finance uh so many players focus on u.s uh and u.s is the top priority and u.s is the largest single market by far you know four per four percent of the global population with twenty percent of the global gdp um it's very established financial economy et cetera so u.s is by far the biggest market but finance is not uh we're we're doing pretty good in the us but we at one point actually when coinbase ipo last april um finance us's uh trading volume reached about 35 percent of coinbase's global trading volume just fine as u.s so that was pretty and then since then we have

minus u has been done down downtown for like three or four months due to some personnel changes and we since reversed that but finance u.s is not it bias does not lead in the u.s market but we do lead in most non-us markets um so even europe uh in most countries were with the leading with the leading um uh app that people used to interact with crypto blockchain um and we also spent a lot of effort focusing on non-developed nations like you know africa latin america etc uh and the per user income in those countries are very low um so people we have a large number of users each one have fairly uh low number of uh coins et cetera so the revenue is not that high

but we can help millions and billions of people today's hundreds of millions hopefully by the next bull run we should be able to expand to billions of people so we provide people access to financial tools they don't have access access to this is something that's very hard for u.s uh people in developing economies to imagine okay story i talked to one guy in person historically it would take him three days to pay to pay a bill he had to walk to a city um sit in the bank for half a day and then pay a bill with blockchain now he can do that in in three minutes um there are other countries that are the the the the um the local currency going through hyperinflation and um people peop

it used to be people people as soon as people get a paycheck to prevent from inflation they go buy milk milk holds more holds host value more steadily than uh fiat currencies wow and milk will go bad in a couple weeks but you know they they go out they go out and buy milk but now with a blockchain with with bitcoin with crypto they they go buy crypto and we are the platform that that let them do that so we spent a lot of effort in different uh uh in different regions so we optimize for different parts of the world so we view that the world is one place and we want to provide our services globally to everybody on earth cece i want to get into this whole how d5 is going to get bigger than c5 and also therefore your plans for bnb chain

and how bmb chain is going to develop in this bear market as well uh one quick question before we go to a quick sponsor break uh there is roughly like 500 people asking me about these this luna classic burn in the youtube chat what's going on with the luna classic burn why are people why are people asking about this you know what do you know anything about this um in fact actually um i did ask my team because i also saw saw a bunch of messages about that i was like what is this lunar classic burn um but it's no one's clear what exactly that burns supposed to be is the team burning it is it exchanges burning it is it somebody else burning it um should we should we charge a fee of like 1.3 for every deposit and burn one point 1.2 of it uh no one know like should we

burn that should should we burn that the the revenue we make should we go zero fees on luna um so it's not clear what exactly that proposal is um it just says the community support anybody burning 1.2 of their own luna great um so should we just burn all of our users luna if we if i think if you take a pull of asking specific users if they're willing to burn 1.2 percent of their luna they hold most people probably say no um so i'm not sure what that means exactly so um i did ask our team so but we'll figure it out i think as long as there's a common consistent way and fairway that applies to everybody we're more than happy to support whatever the the community agrees on amazing okay go for it right anytime someone says

luna i still get ptsd so i just like this is uh classic this is luna classic okay different story i don't even know what that is okay cece i'm gonna ask you a bunch of questions about bnb chain right after we get through some of these fantastic sponsors that make the show possible there is a brand new staking feature in the ledger live app today we all like staking the assets that we're bullish on and now you can stake seven different coins inside the ledger live app cosmos polka dot tron algorithms tezos solana and of course ethereum with ledger live you can take money from your bank account buy your most bullish crypto asset and stake that asset to its network all inside the ledger live app through a partnership with figment ledger also lets you choose which validator you want to stake your assets

with and ledger is running its own validating nodes offering a convenient way to participate in network validation and it even comes with slashing insurance ledger live is truly becoming the battle station for the bankless world so go download ledger live if you have a ledger already you probably already have it and get started securely staking your crypto assets the brave browser is the user first browser for the web3 internet with over 60 million monthly active users and inside the brave browser you'll find the brave wallet the secure multi-train crypto wallet built right into the browser web 3 is freedom from big tech and wall street more control and better privacy but there's a weak point in web 3 your crypto wallet and most crypto wallets are browser extensions which can easily be spoofed but the brave wallet is different no extensions are required which gives brave browser an extra level

of security versus other wallets bravewall is your secure passport for the possibilities of web3 and supports multiple chains including ethereum and solana you can even buy crypto directly inside the wallet with ramp and of course you can store send and swap your crypto assets manage your nfts and connect to other wallets and defy apps so whether you're new to crypto or you're a seasoned pro it's time to ditch those risky extensions and it's time to switch to the brave wallet download brave brave.com bankless and click the wallet icon to get started the layer 2 era is upon us ethereum's layer 2 ecosystem is growing every day and we need layer 2 bridges to be fast and efficient in order to live a layer 2 life across is the fastest cheapest and most secure crosstrain bridge with a cross you don't have to worry about high

fees or long wait times assets are bridged and available for use almost instantaneously across his bridges are powered by uma's optimistic oracle to securely transfer tokens between layer twos and ethereum across its critical ecosystem infrastructure and across v2 has just launched their new version focuses on higher capital efficiency layer two to layer two transfers and a brand new chain with polygon all while prioritizing high security and low fees you can be a part of across crosses story by joining their discord and using a cross for all of your layer 2 transferring needs so go to across.to to quickly and securely bridge your assets between ethereum optimism polygon arbitra or boba networks alright guys we are back with cz from binance and i want to turn the

conversation to the defy side of the world uh cece you talked about how it's your opinion that defy will eventually come and eat c5 uh and i think i think you've known you've had this idea for a while i think it's one of the main uh main motivations for spinning up bnb chain which has it's i think it's like the number two blockchain that's generating revenue after ethereum itself uh and so it's got obviously got a ton of usage and i kind of just want to pick your brain about the future of bnb chain because there's so many different research areas in the world of crypto you got things like cosmos that are doing the application specific blockchain you've got things like ethereum that are doing the roll-up-centric roadmap you have things like solana that are trying to be this hyper scalable monolithic chain i'm

wondering what what is the path for binding or bnb chain where is bnb chain going in the future um to be honest i'm not sure where b b chain is going um and i only get told afterwards with whatever works [Laughter] so i'm not i'm not that involved in the bmb chain development to be honest the developers i do talk to a few of the key developers on you know random ad-hoc basis um they do ask me for some uh for advices from time to time or even opinions et cetera but um we want bmb chain to be community driven um so we we're more we're much more on the sponsorship uh side of things we want to sponsor more projects to to to develop a bmb chain and we want to invest more we

want to promote it more but exactly where it's going is a very community driven thing um i know that people i've always recommended them to look at scalability so you know i i view ethereum as sort of the blockchain that proves that smart contracts work but it's not very scalable they can only do like 20 30 transactions per second so we need millions of transactions per second so we don't have we don't have quite had that yet but we need to take steps in that sort of scalability front um that's my suggestion but you know i didn't come up with the idea of the solidity compatible evm uh evm etc it was basically the um the few develop the number of developers in the

community they come up with those so um for me like we just want to support it um we can we can support it by funding by marketing by branding etc but um it's really up to the community on what they want to develop how are you seeing binance bmb chain being used uh what would you say are like the most dominant use cases that people are using bmb chain for i think today based on a report i saw yesterday or analysis i saw yesterday most people uh the it's defined gamify which are two of the largest use cases on bnb chan so bmb chat actually has by far the largest number of active users on the blockchain so the total tvl is smaller than ethereum like the total value locked is smaller

than ethereum and um but the if you look at the number of active addresses on a daily basis it's about like i think if you put all the blockchains together b and b chan probably has somewhere around 60 to 80 of the active addresses on a daily basis so it's a pretty majority of in terms of users which is great because um i've always anybody i talk to whether it's internal finance or community developers i always say focus on the users just get the users in make sure that people are using your product they may or may not be paying for it or paying very much for it but as long as people use your product that's value so that's really good to see so today those two are the biggest use cases and then uh i really i really want to see other use cases you know nfts

metaverse all of those things being built on top of uh all in relation to uh bmb chain there the topic of the bnb the asset i think is actually particularly interesting and it's something that i actually use as a frame of reference when ethereum goes through the merge the bnb as a as a token in a crypto asset is the only crypto asset that has like meaningful revenue behind it due to the buyback and burn from the binance fee exchange and as a result of that i think i would like to say as a result of that like the bnbc token has some of the most astounding returns in all of crypto i think it like i seo'd in 2017 for something like three cents five cents or something and now it's at uh a cool 218

dollars uh and so that that's a fantastic return uh it would you credit that the amazing price performance of bnb is from the the buy back and burn model of binance or what would you credit to the success of the price i think uh today definitely not uh today the i think the burn is actually a very small part of the bmb echo system value i think bnb's most value actually is derived from the d5 world today there are so many different use cases that people can use bmv for and um there's bnb staking on pancake swap um there's venus uh which is a stable coin uh and there's many different

things that people people can also use b b to buy airline tickets um even coffee et cetera this is a minus card uh people can use bnb to pay for things um so i think the burn is only a small part of it now at the beginning the burn may be like the the burn may be a big part of it and we have since changed the burn protocol to depend more on the activities on the b and b chan instead of revenues from uh from binance etc so um that change was was adopted so today i think bmv is bitcoin et cetera they're much dependent on utility value how many what people use it for uh if there are use cases for it then then it has value so i think uh

uh this is different from like traditional um stocks or securities weight depending on on a company's revenue um b and b is way uh i think b and b is way beyond that now you said that b b was uh you could use it for like airline miles is bnb being adopted like as a medium of exchange currency in some instances it is to some extent so we have a portfolio company called travala which you can go and buy uh buy airplane tickets book hotels etc and you can of course use bnb is a very heavily promoted uh uh uh currency there uh we're partnership with uh you know large shopping malls that have like 30 29 shopping malls um 13 building

mega mega buildings et cetera so we we we've tapped into this type of different uh use cases so um there's a i think there's a lot of value uh bms derived from that so cz i want to ask you a question about um you know bnb chain and kind of just overall um centralization your philosophy on centralization versus decentralization because there are some skeptics who would say bnb chain is too centralized some that would even say that it's it's maybe it's co-opting d5 that's not really d5 and we've seen some you know concerns with uh i think chains co-opting defy in the past like maybe maybe tara was not as centralized as people thought uh it was and or not as

decentralized as people thought it was in the beginning and i will say like for bankless for david and myself we have concerns about this too right because the core mission of crypto to us is peer-to-peer is to go without banks is to go bankless like that's the name of the podcast right that's why we care about this stuff and on one hand i see all of the incredible things that b b chain and binance has done for crypto which is like you guys have onboarded millions of people tens of millions of people and you've made the world better in various places than it was without binance entering and the decentralized chains wouldn't have gotten there in the way that that you guys have and yet at

the same token i worry about centralization vectors i worry about our industry and our chains becoming much more like the traditional banking system that we just left and if that's what we end up with i will feel like the crypto experiment will have failed what do you say to this to concerns about centralization on on b and b chain or about like you know finance having too much influence uh or these these sorts of uh concerns that people have yeah so um so yeah i think this is a very uh thank you for what you said i think the way you described it is actually very objective and those concerns are very valid um in the decentralized world well it's first of all decentralization

centralization is not black and white it's not one or the other there's a spectrum of different and this number one is a spectrum if you look at any particular aspect and there's multiple aspects we've got to look at so each one of them is a gradient scale and so uh for example if we look at any cryptocurrency or blockchain bitcoin uh bitcoin i i do think is by far the most decentralized blockchain cryptocurrency etc but if you look at bitcoin mining um it's quite centralized like you know the top two miners will work top two or three minor mining inputs will control more than 51 of the mining power and if you look at ethereum or bmb chain you can still associate a funder uh with

those two blockchains and many other blockchains so ethereum in that sense if italic suggests some uh changes most likely the community will go with his suggestion um for bnb uh myself we can still identify that even though i'm not i'm less technical much less technical than metallic but if i suggest something the community most likely will support it so that's centralization as well so uh ethereum and bnb having the identifiable funder is actually a less decentralized mechanism and then there's you know how many nodes we uh each blockchain has um and also if you look at binance.com yes.com is a centralized exchange and how many users do we have we probably do

have the largest user base in crypto now um and also we probably hold custody of the largest funds of any single platform in crypto today so all of those are centralization type of centralizations uh where there is a line where it's good or bad it's very very difficult to tell um and if and as you said so for example the most decentralized manner would be like everybody working for themselves um no company no organization in a decentralized world any two people can choose to work together when they choose to work together that's centralization if you and i work together then we're more centralized than david because david is working alone um so uh

but if we all work independently are we able to achieve the maximum impact that we can achieve today probably no if if we didn't start a organization if we didn't hire people to work on common goal then finance would not be able to onboard so many users into into crypto we would not be able to provide the kind of tools we we could provide today for hundreds of millions of people that that use them today are those centralization yes are those bad or good uh i think so far we've we've done good um and but if someday i turn evil and then do something bad then that's not good so decentralization prevents uh a single person's turn a single entity turning evil which is a good prevention measure so um

but but in a decentralized world you cannot prevent people from working together right so you're not supposed to interfere with other people unless as long as they're not harming you or not harming themselves so um centralization will naturally form so i think um as long as we're centralized we just got to be very cognizant of the fact that we're not centralization is not a goal um also to be honest decentralization itself is actually not really the goal the goal we want to we want to achieve is give people the freedom we want to develop technologies that give people freedom ease of use low fees um so freedom including permissionlessness i meaning that if you want to send some money to somebody to somebody else across the

world um that's legit activity um you're not doing something dodgy you should be able to do it so we want to we want to protect the fundamental properties that we want to achieve through decentralization in the process there will certainly be certain levels of centralization groups working together etc but we don't want that to be the ultimate goal it should not be ultimate goal for a single organization to control all the world's crypto et cetera so when a single organization gets too big we should look at how to diversify that to the extent that we actually invest in other crypto exchanges centralized exchanges we invest in our competitors so that we want we actually we actually want other exchanges to exist in more

exchanges to exist in the in the in this uh in this industry this way we can grow the industry faster right now we not being arrogant but we're doing the lion's share of the work on our onboarding users into crypto so we want to see more people doing that so um yeah so it's a very tricky question there's no right or wrong and but i i i'm actually very in much agreement with you it's um we want to be careful that we don't we don't become overly centralized overly big overly monolithic can i can i just say so david david and i um talk very much on bank list about this layer zero which is the social layer of crypto and very important layer right it's all of us collectively and you have a lot of influence as a layer zero participant uh who is running a

major uh exchange right and so i totally agree with you that decentralization even of itself it's anti-corruption technology basically it's a means to an end and that end is is freedom and i'm curious maybe like personally cz um why are you in crypto because like for me look everyone's in crypto to get wealthy right that's part of it that's part of freedom as a matter of fact right you have some wealth you have some financial freedom you're no longer a waste wage slave that's fantastic that's one reason to be in crypto but that's not the only reason i'm in crypto right and i think there are many many others who are believers in this concept of freedom right actually getting out from under um like the structures and institutions

that have controlled our lives for for too long why are you in crypto um we asked this question of brian armstrong he had a different answer and sbf of uh you know ftx why is cz in crypto so i think crypto is a technology that can increase the freedom of money for billions of people around the world and uh and in throughout history anytime we can increase the freedom of something without sacrificing other aspects you know security compliance ease of use ex fees etc if we can increase the freedom of something our civilization advances so if you look at freedom of speech in some countries only today freedom of press again only in some countries um freedom of information freedom freedom of education freedom

from slavery any time those things happen and those things happen over a number of years they all didn't just happen like that they all took multiple decades or even centuries for those changes to to come but when those things happen our civilization advanced so today we have the new technology for money that can significantly increase freedom today our money is not that free like even after you pay all your taxes if you want to if you like say you you're entrepreneurial in china in china if you move more than 50 000 u.s dollars out of china in any given year that's called money laundering um so if if you're on a successful entrepreneur in china and you want to buy a buy an apartment in paris guess what you won't be able to move the

money legally um that this is your after-tax money um so that we don't have the level of freedom there so i do think this technology will enhance our freedom of money and that they're in africa 90 89 of people don't have access to banking so um they they're stuck with using some really archaic methods of finances so um i do think this is a really really meaningful thing for us to do and at the same time we want to stay hundred percent compliant um uh we don't want to cause any trouble we don't want to decrease security aspects so we need to maintain those aspects and and and increase the freedom um for me i think this is for like for me personally this is the most

meaningful thing i could be doing with my life so and i feel very fortunate i feel very lucky to be in a position to make an impact like this um and if i think about everything else that i could be doing um nothing had this level of impact um so have been been lucky enough to be in a position where i can make this type of impact it's hugely rewarding and this comes back to um i fundamentally think that most we're genetically engineered to want to help others of the same kind so if you look at animals any animal that does not want to help this same kind like their own species they they don't have they're usually not very competitive and they usually don't last and genetic evolution evolves them out

for humans i think we are genetically engineered to want to help other humans so we got to take care of ourselves first so we got we got to become financially free taking care of ourselves etc after that the highest highest sense of fulfillment actually comes from helping others so when we are able to help others when i hear stories hey look sisi i i became financially free because i was able to access crypto using your platform that's such a strong sense of reward that i couldn't get anywhere else this is much better than playing golf all day you know drinking martinis all of those those things are still you know once in a while you're okay but this is this this is what makes me thick so um and this is my life so i wake up this is what i'm supposed to do um and i get

tired i take a nap i wake up again this is what i'm supposed to do with my life so for me it's not work it's just what am i supposed to do in this life i didn't hear a full night's sleep in there i just heard a nap so i guess he's he's just napping i do actually i do i do sleep pretty well i sleep like six seven hours night and sometimes you have a guy even still have a nap in the day that's better than david better than your sleep schedule david yeah no that's right yeah and cece i definitely align with almost everything you said there uh like and going back to ryan's talk about the layer zero the social layer of crypto one thing about this industry one of the most bullish things and my favorite bullish thing about this industry is

that the leaders here are largely in it for the right reasons like we have our grifters we have our doklands uh but we there are so many people in here that are here for the right reasons and they're ambitious and they're entrepreneurial and they know how to build uh and so like that there are so much like like so such like hungry people that are also here for the right reasons that are supporting this entire industry and that's one of the reasons why i think crypto has the momentum it needs to take over the world and so if all of these people who are in it for the right reasons succeed which i do hope and i do think that they will where does that take crypto in five to ten years if all of like the super ambitious people who are in it for the right reasons all

achieve their wildest dreams which i totally intend on doing myself i see you already doing it now where does that end up where does that place crypto at the end of this decade like how big are we as an industry um i think well number one is it's not like win or not it's not succeed or not like we're we're all here persistently consistently pushing forward sometimes a bit faster sometimes a bit slower depending on overall market conditions microeconomics and other factors but we're all here we're we're not going anywhere we're just consistently and persistently pushing this industry forward um so i think 10 20 years from now 20 years from now um people people will be using like people

using blockchain crypto the way they use the internet without mentioning it today i don't say like hey i'm going to use the internet to message you uh we just use it like no we just we just use it there's many different applications on it so i think 10 20 years we will get there 10 years might still be a little bit tough to be honest uh even if you look at the internet today uh when we talk about video conferencing sometimes still doesn't work that well and um so uh but i think uh eventually like people shouldn't be talking about blockchains people shouldn't be talking about consensus nodes and all this other geeky stuff people should be like hey i'm sending you some money uh hey i'm doing a fundraising globally uh i'm selling my art globally um i'm gonna um i'm gonna hire some i'm gonna hire

trainer uh fitness trainer in the metaverse um so uh yeah so uh all of the things you should come naturally and without mentioning any technology we will get there it's just a matter of time well uh cz this has been a really fantastic conversation want to thank you so much for stopping by bankless and uh good luck to you during the bear market of course we will be watching uh what's next for binance and what's next for b and b chain and what's next for you so thanks a lot yeah thanks thanks for having me here cheers risk and disclaimers everybody of course none of this has been financial advice all of crypto is risky you could definitely lose what you put in but we are headed west this is the frontier it's not for everyone but we're glad

you're with us on the bankless