Arthur Hayes, the former CEO of BitMEX, has attributed the intense regulatory actions against Binance to its rapid growth and success, which occurred outside the traditional financial and political systems’ control.
In a detailed Substack blog post, Hayes discussed the recent $4.3 billion settlement paid by Binance following its admission of violating U.S. laws related to money laundering and terror financing. He emphasized how Changpeng “CZ” Zhao’s exchange became the world’s largest in terms of trading volume within just six years of its 2017 inception. Hayes noted that Binance’s trading volume would rank it among the top 10 traditional exchanges globally, signifying its significant international impact.
Hayes, who himself faced legal issues for violating U.S. Bank Secrecy Act (BSA) regulations due to inadequate KYC procedures at BitMEX, pointed out that Binance enabled ordinary people to own intermediaries and cryptocurrency assets independently of traditional financial players. He argued that centralized exchanges like Binance used corporate and legal structures to challenge the institutions traditionally governing the global financial and political systems.
Hayes also referenced several major banking scandals and the 2008 global financial crisis, noting the limited accountability faced by mainstream financial institutions in these cases. In contrast, he highlighted the severe actions taken by the U.S. Department of Justice against CZ and Binance, calling the treatment “absurd” and a reflection of the state’s arbitrary nature of punishment.
Furthermore, Hayes explored the current economic situations in the U.S. and China, speculating that China’s potential increase in Yuan-based credit availability could lead to significant capital flows into Bitcoin. He suggested that as Chinese companies find more affordable credit options domestically, the demand for Dollar-based credit might decrease, potentially driving dollars into harder monetary assets like Bitcoin due to the “fungible nature of global fiat credit.”
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