Binance CEO expecets DEFI to Cannibalize his exchange but Binance will still moon
DeFi and CeFi will continue to evolve
Safety will be the main trend of the season
Stablecoins and NFT will be more popular than in 2020
International consortium of news organizations developing transparency standards.
Founder and CEO of the largest cryptocurrency exchange Binance, Chang Peng Zhao (CZ) spoke about the trends and trends in the crypto industry for 2021.
DeFi and CeFi will continue to converge
Liquidity pools and AMMs, especially for stablecoin trading, will remain attractive. In 2021, the crypto community will see an even greater convergence of product offerings in the centralized finance (CeFi) market. Essentially, DeFiDecentralized Finance (DeFi) is financial services built on blockchain technology that offer users access to an open, efficient and … More and CeFi target different users, but bringing them together will help develop the industry as a whole..
“No matter how events develop in this direction, we are ready to support and accept any new innovations and trends in the field of decentralized finance,” said the founder of the Binance cryptocurrency exchange..
Cryptocurrencies will not become a means of payment, and mining will remain unchanged
Despite the fact that cryptocurrencies became widespread in 2020, they never became a full-fledged means of payment. Users are much more accustomed to using existing payment systems that support fiat money. However, the first step in accepting digital coins as a means of payment has already been taken – PayPal has added Bitcoin to its system..
As far as mining is concerned, there are no big changes to be expected in 2021. The industry will develop steadily, but will not change dramatically.
“The miners have already gone through three halvings and they know the industry well. I don’t foresee much change in this area, but chips are always getting faster and cheaper. And as the value of bitcoin rises, more money will be invested in mining, ”said ChangPeng Zhao.
Stablecoins and NTF tokens will become even more popular
The upcoming 2021 could be a breakout period for stablecoins. According to Changpeng Zhao, the number of cross-border payments involving stablecoins will only grow as it is faster, cheaper and easier for the users themselves..
“In 2021, we will see an increase in NFT proliferation – from virtual items in games to concert tickets. I think this is an interesting new area that has yet to be explored and I look forward to seeing how it develops, ”says CZ.
Safety is the main trend of the season
In 2020, hackers carried out more than a dozen attacks on cryptocurrency exchanges and DeFi protocols. Among the most notorious were the hacks of KuCoin, EXMO, BitFinex and others.
CZ is confident that exchanges will place much more emphasis on security in 2021. For this, Changpeng Zhao named at least 3 reasons.
At first, the entire industry needs to pay more attention to user education, to help people avoid being scammed. Binance will continue to emphasize the importance of self-learning and the responsibility of users to make investment decisions. Research before investing is key.
Secondly, ordinary people need better tools to securely store their private keys with proper encrypted backups. Good cyber hygiene is tricky and can scare off newcomers to cryptocurrency. Binance has developed several wallets to help along this path. Combining security with ease of use will be vital as more people invest in cryptocurrencies.
Thirdly, centralized exchanges should increase investment in security technologies such as threshold signatures (TSS) to securely store user funds. Binance has made our TSS library open source, and a large number of community developers contribute to it. Security threats and the technologies used to protect against them evolve over time, but one thing remains the same: the human factor.
The human factor is the weakest link. Attackers constantly profit from psychological flaws, such as the need for quick information and human greed. More and more sophisticated methods of abuse of trust are emerging, including fraud to obtain confidential data for the purpose of stealing money and social engineering. This can be avoided by using a number of protective mechanisms that the crypto ecosystem relies on, such as 2FA (Two Factor Authentication).
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How COVID Affected the Crypto Industry
Some industries have changed forever. More and more people work remotely and even remotely make international transactions, which contributes to the greater adoption of cryptocurrency.
COVID has also triggered other macroeconomic changes such as quantitative easing (QE) in almost all countries, which is also driving people towards cryptocurrency. As new QE money enters the global marketplace, most of it will be converted to some form of cryptocurrency. Between payments, institutional investment, quantitative easing and the long-term economic impact of COVID, it is very difficult to predict what exactly will be the most important factor in the next year..
“If you asked me in 2016, I would not say ICO. If you asked me in 2019, I would not say that trading in stablecoins (DeFi), ”said CZ.
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