Binance CZ mentions the need for non-USD stablecoins such as the Japanese Yen

Mr. CZ Holds AMA

Changpong Zhao (CZ) CEO of major crypto asset (virtual currency) exchange Binance held an AMA (Ask Any Questions Briefing) on ​​Twitter on the 14th.

.@cz_binance is back for another AMA here on Twitter Spaces!

Tune in today at 12:30pm UTC and get your questions ready. pic.twitter.com/vFgakvZyyl

—Binance (@binance) February 14, 2023

Among other topics, CZ held an AMA after the New York State Department of Financial Services (NYDFS) ordered Paxos to stop issuing the U.S. dollar stablecoin Binance USD (BUSD). It seems that In the past, CZ has done AMAs for big events in the industry. For example, he held an AMA shortly after the FTX bankruptcy, explaining that Binance’s financial situation is safe, and trying to dispel fears among users.

connection: What is a stablecoin that even beginners can understand | Explain features and use cases

At this AMA, CZ pointed out that stablecoins play a very important role in things like cryptocurrency investment. He argued that the crypto industry should explore options other than US dollar-pegged stablecoins in light of regulatory moves. For example, he said it is a stablecoin pegged to the euro, Japanese yen, and Singapore dollar, and that Binance is also exploring such options.

He also called other algorithmic stablecoins “unique” and listed them as long-term options, but said there was a risk that their prices would not be stable. At that time, he referred to the Terra turmoil, which made it impossible to maintain its value last year. CZ then explained that every stablecoin has its pros and cons.

connection: Terra USD (UST) dipeg turmoil Summary of response from Terraform Labs and exchanges

Stablecoin regulation

Regulators around the world, including Japan, have begun to scrutinize stablecoins even more due to the Terra incident. The latest crackdown is the NYDFS order to stop issuing BUSD.

NYDFS points out that there are multiple unresolved issues between Paxos and Binance. He also claimed that Paxos had risk management problems and violated its due diligence obligations to customers of Binance and BUSD.

It is also reported that the U.S. Securities and Exchange Commission (SEC) claims that BUSD is a security, although no official announcement has been made yet.

connection: Explains why the NY State Financial Services Authority ordered the suspension of the issuance of the stablecoin “BUSD”

In response to the Hong Kong Monetary Authority’s announcement of stablecoin regulatory policy on the 2nd, CZ commented as follows:

We are already seeing many benefits and use-cases for stablecoins:

Cross-border payments, hedging against inflation and even aid disbursement.

Regulation will bring much needed certainty to issuers, users and service providers, as well as accelerating adoption.

— CZ Binance (@cz_binance) February 1, 2023

connection: Hong Kong authorities decide on regulatory policy for virtual currencies and stablecoins

At this AMA, CZ argued that while maintaining the idea that stablecoins have merit, the crypto industry needs to expand its options.

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