By now most reading this heard that Binance and CZ are being targeted by the CFTC for regulatory violations. At the heart of the matter are accounts that are owned by CZ and the firm, both trading against their customers.
This a clear violation of the laws and will deliver a major blow to Binance. Some are theorizing this could take down the exchange. At best, we are looking at heavy fines, most likely totaling into the billions.
Of course, some would say this is just another example of the anti-crypto sentiment and an attack on it. This would not be without validity. However, that is only a piece of the story.
Exchanges are an interesting animal within cryptocurrency. Unfortunately, they were the epicenter for many of the frauds we saw over the past few years. Now Binance is being shown to be in the same light as FTX.
Hence, we have to draw a line to determine what is cryptocurrency versus more crap pretending to be it.
Be Like The Bankers
CZ certainly is acting like a banker.
Cryptocurrency was designed to get humanity away from the banks and have it operating in a different manner. Unfortunately, it seems all we did was recreate the same animal.
What we are seeing in cryptocurrency is not crypto. Instead, it is more Wall Street antics. This time, only the players changed.
The charges against Binance are nothing new. We saw them many times in the past. One incident involved Goldman Sachs. During the mortgage back security (MBS) craze leading up to the Great Financial Crisis, the investment bank was selling these securities to its clients. The only problem was the firm was also shorting them out of another division.
In other words, the firm was selling an asset that it was actively betting against. Ergo, the situation with Binance is nothing new.
To Goldman Sachs, fines are just a cost of doing business. The firm paid out billions for its "crimes" and went along its merry way. You can bet the result was a net positive for their earnings, once again proving who is really running the show.
CZ might not be so fortunate since this could cripple his firm. However, it does show how the centralized exchanges are really nothing more than Wall Street replicas.
A Decentralized Future
If we want things to change, we have to get away from this.
The last 24 months were important lessons in not your keys, not your crypto. It is something that people learned the hard way. This is just another example.
Decentralization offers a great deal of promise. To get their, people need to be willing to endure a bit of inconvenience.
How often do we hear people complaining about how difficult decentralized applications are? They refuse to spend the time to learn how it works, giving up. This is usually followed up by moving funds to a CEX, further enhancing their powers.
That isn't to say that development is absolved from focusing upon ease of use. This is something that is required. Nevertheless, people have to be willing to step out of their comfort zones.
It is time that cryptocurrency be taken over by those who are concerned about the tenets and what it brings to the table. The last 5 years (at least) saw the industry hijacked. This was done as Wall Street entered. People got excited because they had dreams of their favorite coins mooning. Unfortunately, that is inviting the wolf into the hen house.
Hive is fortunate in that it is overlooked. Very few exchanges carry it. Thus, when bans start coming, Hive will be outside the target range.
That does not mean all is rosy. A lot of work is required. Hive is going to need to develop its own on ramps to provide entry into the ecosystem. This is going to get more difficult as time passes. The regulators will throttle things, we can count on that.
Size Does Matter
Hive has a major advantage. It is very small.
Many will look at this as a problem. However, if we look at the numbers, we can utilize what is taking place to our advantage.
The reality is that all on ramps cannot be stopped. With cryptocurrency, there is always a chance that goods and services can be purchased using this medium of exchange. This means that we will always have a few ways to enter and exit.
Another is the fact that we have a basis with social media. This can attract people setting off the network effect. At the same time, we see the main coin, $HIVE, being an access token. That means the greater the number of users results in a correlated increase in demand.
Hive is dealing with something like 10K daily users. What happens if this number reaches 150K? The numbers dictate this will impact demand in a large way. Naturally, with Hive's design, we see that the coin is not just acquired but also staked.
This is the major difference maker.
Tough times are ahead. The advantage for Hive is to build around what the established bringing to the table.
Here is where the tenets of cryptocurrency truly reside.
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Binance can see the full order book especially those with leverage are easy targets. Not hard to systematically wipe them out.
It is very dangerous to keep funds overnight on a centralised exchange! Lucky we have our own wallets on Hive.
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Not your keys not your crypto.
IT is really that simple.
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Central exchange must be treated like an ATM and not like banks.
We need to be more decentralized but all we with Binance was everything Bitcoin stands against, if Binance falls it will hurt many other projects.
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It will be a set back and something that we have to work around. We need a lot more pojects like we see forming in Cuba.
This is how we work around the major centralized entities.
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I think the current situation with Binance further reveals why we need decentralisation. If the crypto exchange falls, it could be worse than FTX. Self custody is way better for the investors.
I guess its not a surprise to most people who have been involved with crypto as they know what Cexs stands for but for the new users, they fee binance or any other cex is the safe heaven that everyone is talking about in the crypto space.
Perhaps this will be a knock on the head for most and help us move towards real decentralization from every angle possible, not only with exchanges.
CEX will play a major role in the coming years to let us know about the true meaning of Decentralization and these would be a hardcore example for us to decide where should we keep our coins at all times.
These major facts of CEX and the people behind it they sure will take benefit from their clients/customers whenever they can. In fact we sure are giving them that advantage. But either way if Binance takes a hit as of this moment, the whole market is going to take a beating! Not a great time tbh!
In essence, the success of any project within the blockchain and crypto space ultimately hinges on the choices made by the general populace, who opt to engage with or utilize their services.
The adoption of blockchain technology and cryptocurrencies can be a complex and demanding process. To overcome this, education will play a crucial role in facilitating broader adoption, while decentralized projects must prioritize streamlined on/off ramps that enable users to manage their finances with greater ease and convenience, without the need to overcome multiple bridges.
So far I thought people would come to their senses and actually use crypto for what it is.
The thing is that decentralized money demands private responsibility. DAOs demand involvement from stakeholders and proactive individuals that will push development. No wonder why centralized businesses tend to do a lot better in terms of delivery.
I guess the industry will, at some point, mature to a point where we will see the true potential of digital economies.
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Tough times are no doubt ahead if Binance is taken down, CZ and JS are going on like gods, and they can't keep covering their tracks forever.
Hive's stage in development and size now is an advantage we tend not to appreciate, some of these incidents tell us it is rather safer for Hive to be flying under the radar for now.
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There's a lot being built on here, underneath the foundations. We may be small now but in 10 years wow :)
I said it back in 2020, that the 1st major explosion in Ethereum-based DeFi was a crypto-esque casino funded by VCs and Wall Street. It completely went against the ethos of what cryptocurrency was designed to do.
I remember looking at DeFiPulse.com back then, and seeing how literally every protocol in DeFi was Ethereum-based EXCEPT the Lightning Network, which was always overlooked, even to this day.
Tornado Cash? - Wrecked by the OFAC.
Yearn.Finance? - Wrecked in the bear market by de-leveraging.
UniSwap? - Just deployed on BSC for v3, after years of being ETH-only
PancakeSwap? - Centralized for BSC
SushiSwap? - SBF's personal "DEX" which isn't decentralized + volume has tanked
Point being that DeFi was largely a Wall Street greed-driven play outside the traditional fiat market, but it was just a replica, as you say.
Binance will have a special place in hell, for how much money they have stolen from customers & users, and it turns out, they were front-running ALL the trades that were being placed on their platform. If you believe CZ, he claims 99% of his BILLIONS of Dollars in wealth is in BNB & BUSD? and only 1% in BTC? IF that were true, then who was buying all the Bitcoin on Binance? If not the 300 other accounts he controlled? Who created that volume?
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