Binance CEO Changpeng Zhao says there is a myriad of factors potentially driving the next big rally for Bitcoin (BTC) and other crypto assets.
In a new interview on CNBC, the richest person in crypto says different catalysts triggered the previous bull runs and people were not even aware that these would set off massive moves.
“Nobody really forecasted NFTs [non-fungible tokens], DeFi [decentralized finance], etc., which probably drove the last bull run. Before that in 2017, it was mainly ICOs [initial coin offerings]. Six months before those things happened, very few people can forecast it.
Now the market is so much bigger. There are so many more applications in the space. I’m not sure which one, but I think all of those are moving in a positive direction.”
Zhao says regulatory developments and the economic situation could be favorable for crypto.
“The regulatory landscape is shaping up to be quite well. Most countries are adopting regulatory frameworks, they are not banning Bitcoin or cryptocurrencies. The macroeconomics situation will be high inflation, the talk about recession, etc. All of those things drive adoption into Bitcoin, into crypto.”
The Binance CEO also explains why crypto and the equities market are currently moving in the same direction.
“Logically, cryptocurrencies should move counter to the stock market. In theory, they should be negatively correlated, but today, the cryptocurrency market is so small… When the stock market crashes, people want to cash. Today, most people who are trading cryptocurrencies also trade stocks so right now, it’s positively correlated, which is illogical, but it’s just the way it is right now.”
He says he also finds the US regulatory situation odd as both the U.S. Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission (CFTC) currently assert the right to oversee cryptocurrencies.
“Right now in the US, it’s really interesting. We have multiple regulators fighting for jurisdiction over the industry, which is good in a way, which also causes other problems in different ways. It’s a bit unclear.
In most other countries, this problem does not exist. Most other countries, their regulatory agencies are quite clear. Sometimes it’s the central bank. Sometimes it’s the securities market regulator. Sometimes it’s a brand-new regulator, so most regulators are trying to clarify regulatory frameworks in their countries, which is very positive. US is a little bit unique and that is a large country with multiple regulatory agencies and now it’s unclear who controls the space.”
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Featured Image: Shutterstock/estevez/Nerijus Juras
