Binance CEO Changpeng ‘CZ’ Zhao is looking to bring smaller algorithmic stablecoins to the market, in a bid to offer investors options other than the current global stablecoin giants.
Speaking in a July 31, ask me anything (AMA) session on Twitter, CZ cited risks associated with large stablecoins such as Tether (USDT) and Binance USD (BUSD), saying that while Tether is by far the largest stablecoin by market cap, he remains cautious of the asset due to its lack of transparency:
“I personally have not seen any audit reports of USDT. I don’t think most people I spoke to have not seen that either. So it’s kind of a black box because we just don’t know.”
Even supposedly well-regulated and fully audited stablecoins such as Binance USD come with their own set of unforeseeable risks, he added.
On Feb. 13, blockchain infrastructure platform Paxos Trust Company ended its partnership with Binance and ceased minting new BUSD stablecoins, following an order from the New York Department of Financial Services (NYDFS).
“We should just work with as many stablecoins as possible. We shouldn’t have a single bet,” he said, highlighting that the regulator moved to shut down BUSD despite it being fully audited.
As a result of the regulatory and transparency risks, CZ revealed that Binance is working on algorithmic stablecoins as well as diversifying its stablecoin partnerships to spread out potential risk.
“We actually have a small team working on algo stablecoins in different places that are not high scale, but they are very relevant locally in those places,” he said, adding:
“So our approach is, you know, given everything has some risk, let’s just diversify and see which one grows bigger.”
Cointelegraph reached out to Binance for further comment but did receive a response by the time of publication.
Notably, the CEO also announced Binance’s plans to launch the First Digital USD (FDUSD) in Hong Kong as well as setting its sights on new stablecoin options in Europe.
First Digital USD is a programmable U.S. dollar-pegged stablecoin managed by First Digital Group and licensed in Hong Kong. The company listed the FDUSD stablecoin on Binance onJuly 26.
On June 5, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Binance, CZ and other affiliated entities, alleging that they were involved in the sale of unregistered securities, fraud and conflicts of interest.
Bitfinex CTO Paolo Ardoino explained that if the hacking group was telling the truth, they would have asked for a ransom, but he “couldn’t find any request.”
The symbolism of Labour taking the West Midlands mayor, a jewel in the Tory crown, could be felt in the room as Labour activists gathered in Birmingham to celebrate the win with their new mayor Richard Parker and Labour leader Sir Keir Starmer.
There are moments on election journeys when the momentum shifts – and this win felt like one of them.
“We humbly asked [the voters] to put their trust and confidence in a changed Labour Party and they did. And that is a significant piece of political history that we’ve made here today,” said Sir Keir at his victory rally.
“So the message out of these elections, the last now the last stop before we go into that general election, is that the country wants change.
“I hope the prime minister is listening and gives the opportunity to the country to vote as a whole in a general election as soon as possible.”
This win gave them the boost that was missing when they won the Blackpool South by-election on a massive 26-point swing, but then failed to pick up the hundreds of council seats they were chasing.
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This win, on just 1,508 votes or 0.25 per cent of the vote, was a body blow for a Conservative party that believed they could just about cling on. Ben Houchen, the Tees Valley mayor, is now the last Tory standing.
For Labour, then a moment to bookmark.
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Just as Boris Johnson’s Hartlepool by-election win in 2021 was a low point for Sir Keir – he told me this week that he considered resigning over the loss because he thought it showed he was the barrier to Labour’s recovery – this too will feel devastating not just for Andy Street but for the PM too.
Labour has beaten him in a street fight. He’s bloodied with Sir Keir now emboldened.
“This was the one result we really needed,” said one senior Labour figure. “It’s been our top focus for the past week and symbolically a very important win.”
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Analysis of local election and mayoral results
And Labour needed the boost, because, as Professor Michael Thrasher pointed out in his Sky News’ national vote share projection calculated from the local election results, Sir Keir was not picking up the sort of vote share that Tony Blair was winning in the run-up to the 1997 Labour landslide.
His latest calculation of a 35% vote share for Labour and 26% for the Tories, put Sir Keir winning a general election but short of a majority.
What the West Midlands mayoral win did for Sir Keir was to give him a clear narrative that he is coming for the Tories and will do what he needs to take them down.
It raises inevitable questions about what is next for Rishi Sunak. The prime minister had nowhere to go today, not one win to celebrate. The worst performance in council elections in 40 years, was already pretty much as bad as it gets before the loss of Andy Street. The former Conservative mayor was magnanimous towards the prime minister, saying the loss was his alone.
But colleagues will not be so generous. One former cabinet minister said this loss was “devastating”. “We’re done and there’s no appetite to move against him,” said the senior MP. Many Tories tell me they are now resigned to defeat and believe Mr Sunak and his team needed to own it, rather than the rest of the party.
The coming days might be bumpy, the mood will be stony. But Tories tell me not much will actually change for them.
For Sir Keir, he now needs to sell not the changed Labour Party, but his vision for changing the country. The West Mids mayor’s win was dazzling, but it could have so easily gone the other way. And as Mr Sunak fights to survive, Labour still has to fight hard to win.