Name: Binance CEO Changpeng Zhao says crypto isn't big enough to be a sanction loophole for Russia
Uploaded: 2022-03-28
Duration: 5 min 42 s
Description: Zhao believes this idea is “based on a lack of understanding about crypto.”

Zhao believes this idea is “based on a lack of understanding about crypto.”

Binance CEO Changpeng Zhao says crypto isn't big enough to be a sanction loophole for Russia

International

Watch: Binance CEO Changpeng Zhao says crypto isn't big enough to be a sanction loophole for Russia

So, c c let me ask you first about Ukraine. There is real concern that Crypto in particular is a really easy way for Russian oligarchs to be siphoning money out of the country sheltering it somewhere where it's very difficult for people to track. Um I think those are pretty much all based on lack of understanding of crypto. Um there's a couple of dimensions to that. Number one crypto is very, very small. Crypto probably represents .3% of the global wealth and probably the same proportion for oligarchs in Russia. So cripple is not enough to move any significant amount amount of money and also Bitcoin Blockchain very traceable. Um, so the hackers will have to be finished in 2016 as soon as they use the money this year, they got caught and the law enforcement around the world are increasingly very adapt at it. So, um those things, I think that's just a lack of understanding about what Bitcoin or crypto really is nonetheless, what have you actually done to make sure that those on the sanctions list are not your users. Right? So, um just this morning, um, I got an update from our team that we looked through all the sanctions people, all the people on the sanctions list, we have our our sanctioned department actually look at this very, very closely and only one person has ever used that platform. And this is a this is a kid of one of the persons on the sanctions list. So in that regard, actually, none of the people on the sanctions list I've actually ever used. There has been a call from the Deputy President of Ukraine for crypto companies to essentially block the use by Russians. What's your answer to that? And and is the answer to basically freeze accounts from Russia? So we thought about this long and hard and I think basically we don't have the power to decide to freeze a population assets ourselves. I think, I think that decision power should be, should be resting with very senior levels of the government. Um, the guys will create sanctions list. We follow those sanctions lists. So just like banks. So today, if a Russian, if a Russian person is working on the streets of London, um, they probably do have a bank account with some bank in London, um, that the ceo of that bank probably should not unilaterally laterally just decide himself to freeze that person's bank balance. I cannot make a decision. Just I'm gonna freeze your assets on been in that, I don't think that I believe that would be illegal at best unethical. So we we don't have the power to decide that um at a time when Russians at this point cannot get dollars out of the A. T. M. Um the ruble of course is crashing what role for crypto for regular Russians that you know, you say, whose accounts you should not touch. Um just scripture at that point, play something of a role. I think crypto could play a role, but I think people are way over exaggerating that The, as I said before, based on my calculations, crypto probably represents less than .3 of the world, of the wealth of uh of the entire world and probably the same percentage in in in Russia And crypto is so small that you can't move all of the Russia's GDP, which is $1.5 trillion dollars a year ago into into into crypto. Crypto is just not big enough to handle that. And also people miss people miss the point that Russia government actually wants to block crypto. The Russian government actually wants to block. They actually, last week issued, they were going to block international exchanges. They're going to block people from using international exchanges. Um they Russian banks don't work with crypto exchanges. So for the Russian government actually don't want people to convert from rubles to crypto. That hurts the ruble, which has already crashed, as you said, which is already crashing. So, um, I was talking with a politician here just yesterday and he he says, look, the west should allow Russians to use crypto because that would devalue the ruble, which hurts the current government of quite a lot more. Um, so there's different views on that. So crypto is, as you say, tiny 10.3%. What do you foresee? I realized you don't have a crystal ball, but are we at the beginning of something that is really, really big and that in 10 years time we're gonna look back and think of this time is being the very beginning of something. So I think it's very hard to predict the future, and it's very hard to predict with very precise timing, how the future is going to evolve. But things like e commerce in the early days we had a lot of difficulties but eventually took off and it's very difficult to say what at what point is that is exactly something is gonna happen. There's so many factors we can't control, but crypto fundamentally, Blockchain is a new technology for trust, for establishing a common record, for establishing later. Um, this technology will continue to evolve. I think right now, in the crypto industry, there's probably a couple 100 million people who have some kind of exposure to crypto and with this type of a couple $100 million a couple 100 million people involved, they, there's more and more people working on this technology is going to continue to evolve and its technology doesn't go backwards