Binance CEO Responds to Vitalik’s “Burn in Hell” Comments
Binance CEO Changpeng ‘CZ’ Zhou responded in length to Vitalik Buterin’s recent assault on centralized exchanges — the Ethereum Co-Founder stated he hoped they would “burn in hell.”
As chief whip at the largest (centralized) cryptocurrency exchange in the world, Zhou took to Twitter to reject Buterin’s stance:
Got asked a few times, re: “Vitalik’s burn in hell”.
Let’s not wish others to "burn in hell". Let’s have a bigger heart, and appreciate the fact that we are part of an eco-system… pic.twitter.com/4QYGKus0Gk
— CZ (not giving crypto away) (@cz_binance) July 10, 2018
The comment was made during Buterin’s interview on July 6th, 2018 with TechCrunch, where he stated:
“I definitely personally hope centralized exchanges burn in hell as much as possible.”
Elaborating, the Russian-Canadian programmer criticized the ability of centralized exchanges (CEXs) to promote (or demote) cryptocurrencies by charging multi-million dollar listing fees — or what he described as “stupid king-making power”.
While exchanges cannot be solely responsible for a token’s financial gain, many would point to a strong correlation. After listing on Binance within hours of completing its ICO, Quarkchain’s token, for one, increased more than 1200% in valuation in hours.
Accusing the Quarkchain team of price manipulation, one user tweeted:
The clear price manipulation of the QuarkChain price on Binance is obvious. Quark are indulging in a new kind of ICO ploy, which is to sell a minimal % of tokens, pay the extortionate Binance listing fees, then use Market Makers to pump the price.
— Zumberg (@zumberg1) June 5, 2018
CZ Strikes Back
To many, Zhou’s response will have dual-purpose: reading as an appeal for more civility in the cryptocurrency “eco-system”, while highlighting the flaws of Buterin’s argument.
In defense of his livelihood, Zhou argued that centralized exchanges are in fact a vital component of the burgeoning decentralized economy. According to Zhou, by providing increased liquidity of cryptocurrencies — centralized exchanges “probably” accelerate the growth of the entire industry “by more than 10x”.
Pointing out the advantages of centralized exchanges (such as Binance), Zhou wrote:
1. All coins will have far less liquidity (and market cap/price/influence/impact/etc).
2. The industry will be smaller
3. The industry will develop slower.
Going on, Zhou dismissed the immediate advantages of decentralization, while suggesting Buterin may have affected some “king-making” of his own. He writes:
“There is no absolute decentralization. Projects with core teams still have centralization. Today, Vitalik probably has more king-like powers than anyone else in this industry, and has used it, by serving as advisors to projects, therefore helped to decide their fate, at least fate of their ICOs to a large extent.”
As director of a centralized exchange anticipating $1 billion in profits in 2018, Zhou would presumably feel the heat of Buterin’s comments. Yet, the statement’s divisive ‘centralized vs. decentralized’ tone would also seem to threaten Zhou — who closed his response pensively:
We need to keep a view of moving the entire eco-system forward, not just one part of it over another.
Cover Photo by Marc Szeglat on Unsplash
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