Changpeng “CZ” Zhao, CEO of Binance, foresees decentralized finance (DeFi) overtaking centralized finance (CeFi) during the upcoming bull market. Speaking on a Sept. 1 X Spaces session titled “CZ AMA”, he indicated that the crypto industry’s increasing decentralization is promising. He noted that while DeFi’s current volume is 5-10% of CeFi, its rapid growth could soon eclipse traditional trading volumes.
This was evident when, after legal actions against Coinbase and Binance by the SEC, trading volumes on the top three decentralized exchanges (DEXs) leaped by 444% in two days, with the current 24-hour trading volume for DEXs being $722,776,226.
Zhao also praised the U.S. federal court’s recent decision to dismiss the lawsuit against the DeFi protocol, Uniswap. Plaintiffs had alleged losses from scam tokens on the platform, but the judge emphasized that the prevailing regulatory ambiguity lessens investor protection.
The session also touched on the stance that developers shouldn’t be held responsible for DeFi platform misuse. Zhao agreed with this, equating code writing to free speech.
Recent statistics suggest a shift in venture capital interest. CoinGecko reported that in 2022, investments in DeFi projects rose by 190% to $2.7 billion, while CeFi investment dipped by 73% to $4.3 billion. This suggests DeFi could be the crypto industry’s next booming sector, while CeFi might be nearing its peak.
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