Hashed Interview: Changpeng Zhao, Binance, “How Binance Is Supporting Blockchain Ecosystems”
“I think using blockchain for charity is great because it dramatically improves transparency. So today, if you donate 1BNB, you can track which school it went to Uganda and which kids you helped. More selfishly, for our industry, when you’re promoting charity, we have a mandate that all the end beneficiaries have to accept crypto. This necessarily means that we are pushing education. I’m sure that kids in those schools will love crypto, and when they grow up and properly educated, they’re going to make a big impact. So it’s not just Binance donating. We’re getting other people to donate. Other contributors have donated about $4.8 million so far.”
During the Hashed Interview, founder and CEO of Binance Changpeng Zhao, spoke about how Binance is supporting blockchain ecosystems around the world in more than five different ways. Furthermore, Zhao also spoke about binance labs, binance launchpad, binance charity, etc.
Thank you for coming all the way out to Korea. Thank you for having me here. Yes, and thank you for carving out some time — I know you just got off a keynote today. I just finished a panel. But today, I just want to sit down with you, touch on some high-level Binance-type ideas, touch on BNB, just to get a lot of awareness out to Korea, because I’m not sure you do a lot of interviews here in Korea.
Actually, I do come to Korea quite often. I’ve come here three times in the last 15 months, and so this is by far the highest frequency place I’ve visited to do a talk. But — I don’t speak Korean myself — given the language difference, not too many people know about us, about the details of Binance and BNB.
Yeah, because you guys have a lot going on.
Yes. We have a lot of stuff going on. So a lot of people think of Binance as an exchange, right? They know that Binance is a crypto-to-crypto exchange. Yes, we are one of the largest crypto exchanges in the world, and that’s one of our main businesses as well. But we have a lot more other stuff — we have the fiat exchanges in various different places, including New Jersey, Uganda, Singapore. We have Binance Labs, which invests in early-stage projects, so if there are good projects in Korea, we can look at that as well. We have the Binance Launchpad; a lot of people know that recently in the news. That’s a platform helping people to raise money from the public. And then we have Binance Research, which does in-depth reports on projects so that there is more information distribution. All of this is centered around helping projects. And on the other side, we have Binance Academy, which creates educational content.
I watch those videos. They’re short and great.
Yeah. So those videos are becoming more available in Korean as well. So we’re adding more and more Korean subtitles to them. We have Trust Wallet, which is a very good decentralized wallet. And very soon we’re going to have Binance Dex, which is a Binance chain decentralized exchange. And of course, we have Binance Charity, doing social impact work.
So I’ve got questions on all three, real quick. I think the important thing is, the BNB ecosystem is blowing up. There’s been a lot of attention around this. Do you have a vision for where this is all going, or are you trying to keep this fairly organic and open?
So my approach is always organic and dynamic. So we just gotta react. I think many people have seen the BNB chart, where there are like 50 to 100 things on there now. I saw that for the first time today.
Oh really? There’s a lot. I didn’t know that. Okay.
I post that on Twitter all the time. But yeah, all of those are organic. We never paid a single penny for somebody to add BNB to their ecosystem. But what we do in return is, if someone does that, we help them market. So we try to help them in publicizing them. So I actually cannot imagine what BNB can and cannot be used for. It’s a cryptocurrency and right now it’s an ERC 20 token, and very soon it’s going to become a native token on the Binance chain. But it’s much harder for me to visualize and plan how to use it. So we offer a few use cases ourselves; mostly with the services, we provide. We try to build BNB into any service we provide. But there are many other industry players doing very creative things; there’s a really high-end nightclub in Las Vegas that accepts Binance coin — the MORE club.
Did they call you and ask?
No.
They just did it?
They just did it and told us. And we were just, okay, great. So it’s very organic. And I think that’s good because we want this to be decentralized, organic, and whatever works, whatever grows, we’re supportive. We just gotta be reactive so we can give the proper support for this ecosystem.
Very cool. So you probably addressed this a bunch of times, on the Dex idea, but the angle I’m looking from is that: a lot of people have tried, and I think people understand the value of Dex, but what was the logic behind you, being Binance, sort of disrupting yourself and focusing on Dex?
Sure. I think there are two sides to that question. I’ll address the disrupting ourselves first, which is easy. I think we always want to disrupt ourselves. It’s better to disrupt ourselves than somebody doing that to us. And so I think that part is easy. We’re always looking for more innovation. We’re not trying to build the largest exchange and hold on to it. That’s not what we do, and that’s not what the team does. The team is always innovating. And the second part is that I think many people have tried, but when we see those — so this is a situation in which we look at the broad market of the product offerings of the decentralized exchanges out there. We felt that we could do better, that there’s room for improvement.
So what are the one or two elements that make it better?
There’s a few things: number one, the speed. Many decentralized exchanges are initially based on Ethereum, which is faster than Bitcoin, but still pretty slow. We want to increase speed; we’re not doing one-second blocks. One block is final. It handles thousands of transactions per second, and we can scale up more if we add more machines. So that’s one aspect of it — speed, which is always important in exchanges, something we understand very well, and other industry players don’t. Without speed, you don’t get any liquidity; if you’re slow, there’s no liquidity. So speed is tied to liquidity. There’s a second aspect of it, which is ease of use. Most of the other decentralized exchanges are hard to use. You have to understand what a private key is, you have to know all this stuff. The user interface is not very straightforward. So we took the Binance.com interface and said okay, let’s move that on to Dex. So hopefully, that will give people the familiarity it has. There’s still a little bit of a learning curve, but I think we’ve reduced that learning curve to be very low.
Right. Your strategy has always been: launch first, then iterate and iterate.
So I don’t think we got it perfect on the first try. We don’t want to do that, because if we do that, it means we’re going to launch much later. So let’s launch it, have users use it and give us feedback, and we’ll iterate.
The one thing I don’t think many people realize — actually, I was at your Binance Singapore event, and we had this whole talk about Binance Charity. I think it’s really cool that you guys are doing Binance Charity, and I want to know a) the motivation behind it, and b) is this something you want to put a lot more emphasis going forward? Are there going to be more contributions to charitable programs?
Yes. Absolutely. For charity, there are a few different contributing factors, which I think are all very meaningful. First, as a profitable organization that’s growing quickly, I think we have the social impact duty. But there are many other selfish reasons too: from the industry perspective, I think using blockchain for charity is great because it dramatically improves transparency. With increased transparency, I think there will be more people willing to donate. So today, if you donate 1BNB, you can track which school it went to in Uganda. And which kids you helped. You’d be willing to donate more because before, it would be like you donate 1BNB, which goes into this black box, and you no longer know what’s happening to it. And this also ensures that downstream, there’s no corruption or other such shenanigans traditionally associated with the charity industry. So I think that’s a huge impact we can make on the world. More selfishly, for our industry, when you’re promoting charity, when you’re pushing charity out, we have a mandate that all the end beneficiaries have to accept crypto. This necessarily means that we are pushing education. Now, people are learning about crypto, and they’re learning about it in a positive context, with very helpful effects. I’m sure that now, kids in those schools will love crypto. When they grow up and are properly educated, they’re going to make a big impact.
So this is a long-term thing.
This is a long term thing, but it’s actually spreading — anything that’s happening with Binance. When we first started, I wanted to start small, but the team’s execution abilities far exceeded my expectations. So they’re pushing this out really quickly. I thought that we’d have about 500 cases this year, but in the first three months of launching this program, we’ve reached out to 5000 kids. And they’re actually getting industry participants. So it’s not just Binance donating. We’re getting other people to donate. Other contributors have donated about $4.8 million so far. And now we actually have more money than we can push out, so again, it’s the last mile that’s the bottleneck. Again, we’re trying to work through it and keep everything transparent, so it’s actually working out really well.
I have two more questions. The next question — you can toss it if you want — what is the biggest challenge for Binance today?
There are different challenges in different stages. Today, I think it’s really internal challenges. So we’ve grown very quickly / You guys are a very decentralized team /We’re a very decentralized team, it’s really just continuing to grow the team, making sure we have the best team. We have high expectations for people joining the team, and it’s not so much about technical skills than the ethical, philosophical, mental attitude of the person. So we want to look for people who are passionate about this industry, who share our mission and values. Because we are pretty close to the money, we want people who aren’t so driven by money. We want people who actually want to do something good. When we hire people, we typically give them a pay cut. We want to see if that person is money-driven or not. So before, I used to interview everyone who came in. We’re at a size where I can’t do that anymore. So we need to have this culture spread out to the entire organization. I think today, that’s the biggest challenge for us, to maintain this ethical behavior throughout the organization. And today, I make very few decisions at Binance now. I just decide that we want to do charity, and we find a bunch of people who can do that for us. So I’m not involved in every decision, so decision making is very autonomous. I often find out about the coins that we’re listing after the announcement. So making sure that we maintain the high ethical standards, and that we have the best team, is key now. Most of the challenge right now is just making sure that we grow correctly ourselves.
So the reverse question — what are some things that you’ve seen recently that excite you the most about crypto?
Very recently, I think the fact that everyone’s coming to crypto is very exciting. Some people don’t like certain companies coming to crypto, like Facebook or JP Morgan. Right now, we may or may not like their corporate ethos, but the fact that they’re coming to crypto is good. The more the merrier. And there are so many other people coming to crypto as well. Now, Elon Musk is definitely interested in crypto; he changed his Twitter bio to ex-CEO of Dogecoin. Last I checked, it was still there. And Jack Dorsey is coming in… Also, the fact that in the last couple of days, the price of Bitcoin is recovering — it shot up so quickly. It means there’s a lot of pent-up demand. So that’s a lot of money waiting on the sidelines, waiting to come in. That’s a very strong confidence booster. So I’m very confident about this industry. I’m very happy to see that this is happening. I think things will continue to get better. Very cool. Thank you so much for your time. / Thank you so much, for everything.
[Hashed Community]
Hashed Website: hashed.com
Medium: medium.com/hashed-official
twitter: twitter.com/hashed_official
Telegram: t.me/hashedchannel
