Written on Binance’s 6th anniversary: Will there be a warm spring after the crypto winter?

Binance 6th anniversary: Warm spring after crypto winter?

The reason is that Binance Launchpad has launched four projects since early last year, including the Move to Earn application STEPN, the gamified social learning platform Hooked Protocol, the identity platform SBlockingce ID, the education content platform Open Campus, and the recently launched data platform Arkham.

Compared to the phenomenal public chains and projects of the past, Binance’s Launchpad in recent years may be confusing to many, as its choices are not in the well-known field or hot market track.

For this reason, there is a voice in the market that asks whether there should be more tolerance for projects that are brave enough to issue tokens during the market’s calm period.

Leaving aside the issue of return on investment, Polygon, Axie Infinity, and The Sandbox were not favored by everyone before the real explosion of concepts such as new public chains, chain games, and meta-universes. But when they really took off, they saw the potential of this market. For me personally, although I cannot imagine what kind of new business model issuing tokens for projects in the fields of education, identity, and data can bring, I believe that no one can perfectly predict the direction of the market, nor can anyone predict what kind of product will trigger a qualitative change. These projects that have made some “transformations” to traditional fields other than finance may not have an immediate impact, but they are a good attempt.

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The monetization of knowledge and data, the decentralization of identity, and these underlying constructions may not be the target of attracting a large amount of capital, but they are still a touchstone for pushing Web3 into the mainstream. Binance also stated that its attention to these areas is aimed at promoting the adoption of Web3 and ultimately achieving global free flow of finance, rather than just focusing on immediate interests. The so-called tolerance hopes that the market can give these projects some time instead of making impulsive judgments based on the current environment.

How Binance should deal with FUD

In the first half of the year, Binance was sued by the US Commodity Futures Trading Commission (CFTC) and the US Securities and Exchange Commission (SEC). After that, several countries also announced investigations into Binance, and Binance withdrew its compliance applications in some European countries. Various bad news made FUD rampant in the market, and everyone started to speculate whether the content of the lawsuit by the US regulatory agency was true, and whether Binance would become the next FTX.

As of today, Binance is still the most licensed cryptocurrency exchange in the world. The SEC has no evidence to support some of the charges it has listed, and Binance has hired lawyers. Zhao Changpeng stated in his previous Twitter SBlockingces that he is still looking for a solution.

Furthermore, according to community speculation, the US regulatory agency’s “shooting the bird in front of the gun” behavior is actually not simply targeting Binance, but the entire cryptocurrency field. The cryptocurrency community has also expressed its support for Binance through various voices.

In addition, as for the impact of regulatory crackdowns on Binance, we can explore it from some data. According to data from The Block, Binance’s share of monthly trading volume on exchanges still accounts for around 50%, although it has fallen from over 60% at its peak (some analysts speculate that the main reason is due to the end of Binance’s zero-commission BTC activity), it is still nearly 4 times that of second-place Upbit. In addition, after the regulatory agency’s investigation of Binance, this proportion has hardly changed.

Within a few days of the news of regulatory agency investigations, Binance did experience some outflow of funds, but according to data provided by Twitter user TVBee, the degree of capital outflow at that time was less than that of Silicon Valley Bank’s bankruptcy and FTX’s explosion period, and it quickly began to flow back.

Various data seems to indicate that we do not need to worry about Binance experiencing the same thing as FTX. In fact, regulation is not negative. Rules need to be established to regulate money laundering, tax evasion, market manipulation, and other behaviors. However, if regulation is to be imposed on the special industry of cryptocurrency, it will undoubtedly take some time for exploration and coordination.

Waiting for the flowers to bloom

After surviving 2022, we ushered in the first half of 2023, which performed well in the cryptocurrency market. However, it is worth noting that the short-term impact of regulation, whether emotional or practical, cannot be eliminated, and combined with the uncertainty of the macro market, it may take some time for Web3 to return to the “crazy bull market” of 2020 and 2021.

Currently, there are all kinds of noises around us, but the changes in Web3 compared to the uncertainties of 2018 and 2019 have been earth-shattering. Mainstream adoption, new concepts, and tracks may ultimately cause the market to be over-leveraged and backfire during the so-called bull market in 2021, but a mature market needs to experience such pains. We still need to give Binance and the industry some time. Half of success lies in persistence. I hope that everyone will not fall into the darkness before dawn and look forward to Binance’s seventh year bringing more imagination to the entire industry and ecosystem.

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