a month ago 1 min read

CEO of Binance Comments on Idea of "Offshore" Cryptocurrency Enterprises

binance-changpeng zhao-kraken-stablecoin

On February 19, Changpeng Zhao, the CEO of Binance, tweeted that making a distinction between on-shore and off-shore firms was misleading.

Zhao responded to Kraken CEO Jesse Powell's comments on his blog, writing:

“[Powell] uses the word ‘offshore’ quite often…The term ‘offshore’ appears overly narrow-minded, self-centered, misses the broader picture and [is] unhelpful to the development of our industry.”

According to Zhao, all businesses conduct their domestic operations. He called making such distinctions "arrogant" and stated that putting too much stock in domestic companies' competence is not the answer to the crypto industry's problems.

He added that it appears that such ways of thinking haven't worked to stop on-shore fraud. Zhao said that FTX.US failed together with FTX despite the fact that it was an on-shore company with many American executives relevant to the United States.

Zhao vehemently refuted that such attitudes are limited to Americans. He claimed that it is also evident in Asia, where the terms "lao wai" and "gaijin," respectively, are used to derogatorily refer to Western corporations.

Zhao specifically condemned remarks made on February 17 by departed Kraken CEO Jesse Powell in his remarks. Despite the fact that U.S. regulators this month took action against Kraken's staking program, Powell bemoaned the fact that they did not pay attention to his objections about offshore companies and offered justifications for them.

Zhao seems to be aware of the seriousness of Powell's predicament because he tweeted: "I apologize for speaking [this] so directly. No harm intended.

Despite Zhao's views on on- and off-shore business, his company now has to comply with global laws. On February 13, Paxos, a U.S. stablecoin partner of Binance, announced that it would discontinue generating Binance USD (BUSD) due to legal requirements.

Also, it was mentioned on February 15 that Binance would pay fines to American officials to end regulatory investigations. On February 17, Zhao said that while Binance does not intend to remove U.S.-based cryptocurrencies from its exchange, it will probably decrease U.S. investments and bids and "ask authorization first."

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