For CZ’s 7th AMA on Twitter, he covered several topics, such as Binance US, the current crypto market, fiat onramps, and many more.
This transcript for CZ’s AMA last September 26, 2019, has been edited for clarity. For the full AMA, please watch it here.
At Binance, we are always looking to improve and hear new ideas. We recently launched a user feedback tool using nolt.io, and we’ve collected some of the top comments to share with you. I want to go through the top 10 requests we are considering now:
1. Trailing stops
2. Evolution curve of assets (a graph of your portfolio value over time)
3. OCO (once-cancels-the-other) orders on the Binance app
4. Trailing profit
5. Being able to copy and paste price
6. Save charts
7. BNB burn to continue forever, past the 100 million burn limit.
8. Sum-up of profit/loss for pairings
9. Add ETH to Futures
10. Daily check-in rewards.
I think all of those are good suggestions. Some of these are harder to implement than others. No. 7 may be tricky, the burn can’t continue forever. That's a fairly fundamental governance change, but we do receive this feedback, and I do look at them myself.
Current Market Condition
Some people are worried about BNB price, etc. We do get a lot of questions about that. There's an overall market condition that we don't really control. I'm very confident about the blockchain industry, and I'm very confident about the business's ability to deliver and to be successful in this industry. I'm very confident in our team and I'm very confident in our business model and what we do.
We have a relatively proven business model, and we can still scale up quite a lot more. The room for growth is very high. We have a solid team that's building real product. So I'm very confident in what we can do. The short-term market conditions are short-term market conditions the BNB price is actually still not that bad if you compared them to December 2018, nine months ago. They are short-term fluctuations. That's the nature of a new market where the market capitalization is small.
But overall, I think the industry is still very strong. I think Binance is still going very strong. We just keep our heads down and we build. And we've gone through this many times before. Right after ICO, the coin price dropped a little bit, and a lot of people have questions, people are worried about it. And we just continue to build. A few weeks later where we got out of that, and we went our very strong growth trajectory.
And of course, in 2018, that whole year was a high-pressure year. But in those times we just keep building and there are times where a lot of people ask us why BNB prices were dropping even though we release feature after feature? And then there are times people ask us, “Hey, why is BNB price going up all the time? What did you guys do?” But all we can do is continue to build value into our products and continue to build products people use and continue to give users the best experience. So that's what we do.
In the past little while, we have launched a lot of new things. Some of them are really big. Most recently, we worked with our US partners to launch Binance.US, which went live on Monday. Maybe two to three days ago. I can't even really count now. I didn't really sleep that night for those 24 hours.
Binance.com is the technology partner for Binance.US. We provide the technology, then BAM Trading Services is our partner running Binance.US.
The deployment of course is a big technology exercise. And overall I think it went relatively well. We had some glitches at the beginning, but it's very common to any deployment. We wanted to do a couple of trading tests for 15 minutes before the go-live, but then we thought that was not good because people may get confused when there are trades before the markets open so we didn't do it.
We didn't do it. We didn't get a chance to do real-life test trading, so we had some glitches but that was OK and we got over it. All right. Now, the U.S. platform is live. It is running very stable. It is running and it has a lot of pairs already.
There are a couple of misconceptions from people. A lot of people care about which coins Binance.US lists. I'll tell you just very generically that is going to increase over time. It's not going to be a hundred coins at the same time. No platform can do that. The Binance.US team has their own listing criteria and their evaluation framework is very in-depth, even heavier than Binance.com from what I can see.
I'm not involved in that process, but I do want to share with you -- many of you guys were asking before -- that BNB is listed on Binance US. There is strong evidence that it is not a security. It is completely a utility token. So that's one of the things that the community asked for and had really strong support for, so we made that happen. So BNB is trading live on Binance US, and it is a relatively new site. There will be more listings over time, and I think initially they will add pretty quickly based on my knowledge, and then over time they'll continue to add more.
On the product side, on the tech side, on the platform side, it’s also still very new. The KYC process is very smooth. It is very comprehensive. The team spent a lot of time optimizing workflow, so it takes only a few minutes to register, KYC, deposit, and trade. The passing rate for KYC is very high. So the process is done very well. There are three stages to pass KYC and if you passed stage 1, the next few steps go very quickly. So I do encourage everyone to try it and give us your feedback. I think you will like it.
The trading volume is still relatively low, it’s only been running for a couple of days. For any new marketplace, do set your expectations relatively properly. Don't expect any new platform to become huge right away. That doesn't happen. If you look at the first few weeks Binance.com started trading, I think we celebrated when we hit $5 million in trading volume on the exchange. Looking back, that's a really small number but I think that took us like maybe four or five weeks together, like a month. So the initial volume will be low, but you will feel very confident that it will build up over time. So a lot of our clients are still integrating with APIs, still trying to get opening accounts, etc.
But I do have very strong confidence about the Binance US launch, and I think we have a great team there. They're great partners, I think that will go well.
So if you guys have any questions, please do direct them to the Binance America Twitter account (@BinanceAmerica). They are very responsive. Catherine Coley, the CEO of Binance US, is very engaged in the community, and she already did an AMA two days ago. You can ask her any questions. She would do that regularly I assume and you can ask her questions.
The next topic is Futures. Again, another significant product. We launched it two weeks ago officially, maybe a month ago with the beta test.
Binance Futures is a relatively new product but it is a big product already. We only have one pair, one instrument, one contract on it. It is a bit easy contract. But already, we're seeing that the BTC trading volume on Binance Futures is actually about the same as the BTC trading volume of Binance.com on the spot market. That's a very significant quick growth. The first couple of weeks was slow. In the last 10 days or so, there were two times when there was significant volatility in the market, and the volume just showed up really quickly and again, the product’s very solid. I'm very happy with it. I think the team did a really good job. Even two days ago, there was very high volatility in the market. There was no auto-deleveraging and the platform’s solid. So there are no glitches, no problems. I'm very confident with the platform.
Futures is a significant platform that should really help enhance our ecosystem. Futures allows people to trade with much lower costs. So with Margin, yes, you can borrow funds to trade, but with Futures, the leverage is building and the borrowing is free. So it's a much cheaper way to trade. But it has high volatility, and it is very high risk, because when you take margins, there is a chance to get liquidated. So only use it if you are advanced traders. But Futures is a fundamental price discovery tool that and also leveraging hedging tool that's used by many advanced traders.
We're very happy to provide that, and we will think there are more questions later on about adding more contracts under the futures. There will be more added very soon. There is some preparation work to be done by the team, but more contracts will be added soon, and there are going to be more features added to the Futures platform, including adding Futures products into the mobile apps, and we're optimizing the mobile web pages for now.
Futures is growing very healthily very quickly. I'm very happy about that.
Fiat Onramps: Koinal, BUSD, Venus, Buy Crypto Page
I've talked about fiat gateways in the last year or so, and now we're getting much deeper into it. We have learned our ropes a little bit. Binance.com started as a crypto-to-crypto exchange. We really didn't touch fiat for almost two years, but now we are learning the ropes, and we do want to facilitate fiat-to-crypto. So we added Koinal (used to be called Clearsettle), it's one of the latest fiat gateways we added to Binance.com. It allows you to use debit cards and credit cards to purchase crypto directly on Binance.com. There’s KYC involved, but the process is very smooth. The fees are lower than other options.
We already had Simplex before. Simplex right now allows Visa credit cards to buy crypto directly on Binance.com. We are one of the earlier exchanges to add Simplex. Also, to let you know, we are exploring ways to withdraw crypto to fiat as well.
We've launched BUSD, which is a Binance USD stable coin. It's called BUSD but that's in partnership with Paxos in New York. BUSD is a NYDFS-approved stablecoin. I think it's significant for a number of reasons. I won't go into the details, but the regulatory approval aspect of it is very significant. But what we focus on is really the user experience and the product. Right now, the current version of BUSD buying, issuing, and redemption method is done, but we have a second version coming up very quickly, that will be even further optimizing that experience. So we'll make that experience really, really smooth. BUSD is listed on a number of exchanges already, including Binance. And we already seeing a huge uptake. I think in the last couple of days there was like 10 or 20 million dollars being bought by users. So from the issuer’s perspective, these are being distributed. We're seeing very strong demand for BUSD and we'll continue to push that, and I believe that's also a very good way for people to be able to move value between fiat and crypto.
Also, in the same fiat world, there's the Venus project which we’re pushing. We're working with a number of governments and large organizations to enable access and provide liquidity and financial innovation for developing countries. This is pushing forward relatively well, but most users don't see a lot from Venus right now, but work is progressing.
We are also revamping our Buy & Sell Crypto page. If you look at the Binance homepage right now, there's now a top menu item called Buy Crypto. And that's a fiat entry gateway that allows you to buy a few different cryptocurrencies with fiat. So that's also a very significant addition to our business, and we will continue to add more fiat channels onto that page.
Fiat is a very big thing for us, and there are lots of initiatives happening and we hope to be able to add whatever field you're using in your local area very soon.
Small Updates and Internal Growth
Those are some of the really big things we're doing, and there are a lot of small things we are adding and doing every day. If you follow my Twitter account, every day I try to do a summary of what we do on that day, and it usually does not fit into one tweet. Every day we’re pushing out anywhere from a couple to five, six, seven new things we're doing. The pace has picking up, and the team is larger. As the team grew so quickly, we had some internal process/communication issues, but now I think we have optimized the workflow quite a lot already, and it's an ongoing process. We are still optimizing that, but right now I think we're seeing the results coming out very quickly. The team is bigger and we're able to do a lot more now. I think you can expect the pace of new things coming out to be faster.
Q&A from Twitter/live feed
Will you bring back the monthly community vote?
We are actually thinking about different structures of voting. We actually have a project about voting already, and took some coding to do so. Hopefully we can announce that pretty soon, maybe as soon as a couple weeks a week or two.
But the format is a little bit different, because in the previous community voting round, we had to spend so much effort dealing with accusations of cheating, different projects bashing each other, etc. So we have modified the format a little bit.
There are many popular coins which are not listed on Binance. Will you start listing more popular coins as in 2017, or are you concerned about liquidity?
I think we have always been listing coins. It may not be as fast as we have been in 2017. We are always conscious about liquidity. There's a balance about listing coins. If you list coins, especially if you list a small coin and add 10 pairs for it, it's not going to have much liquidity for each of those pairs. Then that damages the user experience for novice users because they have to look at 10 different pairs to try to find the best price, and then the price gap on each pair may be large. For the API trader, that may be less of an issue, they still have the right programs to do price discovery. So there's a balance where we want a smaller number of pairs, so that the liquid is somewhat concentrated, but at the same time, we want to be able to buy a coin with BTC with USDT, ETH, and BNB at the same time. So there's a balance to that. But we are adding more coins, and every week we add a few more coins. Actually the speed is actually not that bad.
And of course we're still facilitating coins through our Launchpad process.
What are your thoughts about Launchpad projects falling from all time high ROI?
For Launchpad, let me share my thought process. I strongly believe that fundraising on the blockchain is a killer app, and I've always believed that. It was honestly abused in 2017. There were too many people doing it, and getting money was too easy. Then there was the market swing to the other side, and towards the end of 2018, it’s very hard to raise money.
I do believe that blockchain fundraising is a fundamentally very useful app for entrepreneurs and for small investor teams to be able to invest in projects across the world. There are some restrictions in certain countries. We respect that so we don't serve as those countries for the Launchpad.
But overall, I think in the long-term, Launchpad allows projects to be able to fundraise on the blockchain, which is a fundamental tool that we should have for our industry and for other industries. We started in January this year, and even in March when everyone said, “Look, it's really hot, you should do more of it, you should do like 10 projects per month,” we were still doing one per month, so we kept our pace. Many other exchanges are stopping their similar efforts in this area, thinking that the performance is not good. We still look for strong projects and we want to help them raise money and we want to help them grow in the long term. This is something that we believe in in principle, and we just need to do it in the correct way.
There are many incorrect or non-optimized ways to do it, which may result in issues. There is no perfect way of doing it, the price always fluctuates, there's no guarantee that Launchpad projects will go up in price or will be profitable for investors. There's always risk. But fundamentally, we do want to work really hard to find good projects, and then continue to help them raise money, continue to facilitate and help them grow through Binance platforms. So Launchpad will continue.
Will you make BNB available for automatic lending? Current option has some people waking up early and end up not being served.
We are actually seeing a lot of traction. Margin and Lending are big products we have rolled out in the last couple months. And we're seeing very good uptake. I think the margin lending amount passed a $100 million a few days ago, it’s probably higher now, and lending is also very well received by our users, especially some of our loyal users. Most of our lending users are also traders who are contributing to our platform activities. We will continue to improve the lending product.
We released the product in a few different stages. The first one: manually borrow before you trade, then you trade, and after the trade, you go to the menu to return the funds, and then during that period it pays you interest.
We further optimized that to this: when you trade automatically you borrow right at that time.
So you don't actually have to go to the margin page. You just stay on your trading page, when you place an order, the margin lending happens right away. So we've further optimized margin so that now when you finished lending, it is automatically returned.
So we are doing those kinds of optimizations and we also add the margin lending to mobile apps. It takes some time, but we are working on it. Lending is available on Android already and the next update of the IOS app should have margin lending on it.
I want that Binance Nike Shirt
There are only 10 of these made two years ago. So there are only 10 of these in the world.
When is the next BNB burn?
I think the next BNB burn is around early October.
Are there any plans to improve the Binance UI?
Yes, there are always plans to improve the Binance UI. You can see that we have made a Web 2.0 project. So there's Binance 2.0 UI, which is a little bit different from the old one. Every day, there are some changes to the UI, so we continue to work on that, and please give us your feedback to help us improve.
Six months have passed since the Binance security incident, and now you're adding fiat to your exchange? Are you ready for the next hacker attacks?
We have been ready for hacker attacks every day. There are hacker attacks every day on any exchange platform, and on Binance especially, so we have improved our security very significantly over the last six months. We've done some of the stuff that people only imagine, so I wouldn't go into security details, but I can tell you that Binance is much more secure than before and probably much more secure than any other exchange in the world.
Many other exchanges are very shy about having issues with security. They try to hide it. I'm aware of a couple of different hacks recently, some of them quite large, on other exchanges. The exchanges did have the funds to cover, and they just didn't announce it, but the withdrawals were stuck for a long time or other exchanges, etc.
At Binance, we’re quite open about it. We're not perfect. So we do have issues but we learn from our issues and we become stronger. So I think there's a conception that exchange that's never hacked or has fewer hacks may be secure. There are two sides to this: yes and no.
These guys will learn from their mistakes and then improve and become stronger. We learn from our mistakes, we learn from our weaknesses, and we make it more secure. So I'm pretty open about discussing it, but Binance today is very secure.
What does the timeline regarding giving more Futures leverage possibilities and listing more Futures (contracts) look like?
We are on the lookout for more contracts. We are also looking at increasing leverage. So yes, all those things are happening.
You’re getting gray in the hair. Take a vacation.
I do have a lot of gray hair, but this light makes it really bad. I guess the black hair reflects a little bit. Someone suggested that I should dye my hair all white and be done with the issue, but I couldn't be bothered. This is one of the issues I'm least worried about.
What's the evolution path for Binance Chain going forward, along the lines of decentralization, governance, smart contract features that would put to rest the security/utility token controversy once and for all.
Binance DEX is progressing very well. It is a community project, and all the members are still working on very actively. There is some interesting stuff coming out of Binance Chain. But to be very honest, eventually Binance Chain will be fully decentralized, and nodes will be given out will be distributed. Governance staking is being considered, but smart contract features probably will get there first.
It will most likely be a similar smart contract to ETH that this compatibility is built. The features that are going to come out really quickly are pegging, threshold signatures, all of the things that people can use directly right away.
On the security/utility token controversy, that issue is probably not solved by a blockchain or a DEX. There’s very little control. Well, no one has control over what's traded on DEX, but whether a token is a security or utility token, that's dependent on the regulations in different countries. Something may be a security in one country and not in a different place. And whether it's really the issuer of those tokens that needs to take responsibility to be compliant in wherever they are. So a DEX doesn't really solve that and doesn’t really avoid that issue but DEX probably cannot prevent people from trading it.
Can we (US residents) still trade on Binance.com?
Right now, there's no way to do KYC for US residents on Binance.com. We would love to be able to service US residents, but we can't. We need to respect the rules.
So what was the outcome for the alleged KYC leaks?
We don’t really spend any time on FUD. So there's a lot of FUD in the industry. If we spend time on that, we will be doing less useful work, and it's not productive. So we don't really engage in debate. It is my personality. And also I guess our team's kind of philosophy. I guess my personality filters a little bit of throughout the organization, but I never engage in debates.
I'm perfectly happy for other people to hold different opinions, even if those are even including the opinions against me or against us. And I don't engage in debates. If a person doesn't know about something, I’m very happy to educate them about. But for example, if a person doesn't like crypto already like, say, for example, Warren Buffett, I have very little interest in wasting my time to educate them. So that's just the way I think so, we don't engage in debate. We don't engage in FUD. We just let it go, we focus on building products. That's all we do. We focus on how to service the user who wants to engage with us. We want to service the users who want to use us. So that's all we focus on.
Yes, I know a lot of people are curious about what we think about this and what we think about that, and how should we respond? We don't really do that. So if there's a question in the community, we try to answer it, but we just ignore FUD. If it's a valid user complaint, we try to address it. We want to make our users happy. But if it's just like debates, we don't engage.
(Our Update & Action Response on this matter outlines our guidance on privacy protection and restitution for affected users.)
When Binance US in Florida?
I think Catherine Coley addressed that in her AMA. Binance US is just starting, and they are working on to get more licenses for more states. I'm not an expert on the US regulatory landscape, those guys are, but remember that everything starts small. It doesn't mean that you will always stay small. We know the Binance US team is working really hard to grow that business. We are working very hard to grow our business. So don't take the assumption that the first impression is the last impression. I think we are one of the teams in this industry that works very very hard. We work ferociously to push things forward. And things will change and we'll bring more and more stuff to our users.
CZ you met me at a conference, you are so awesome.
Thank you so much for your support. Yeah, actually about the conferences, I've not attended that many conferences for the last couple of months, mainly because we have so many products in the pipeline that we're building. And so I've deliberately avoided all conferences for the last two or three months already, and the next conference I'll be attending in November is in Singapore. So if you guys want to catch me in person and take a selfie -- I don't know why people want to do that, but I'm more than happy to take selfies at conferences with it with anyone -- so if you guys want to catch me there, that'd be great. If not, then until next time.
Thank you so much for your support. We’ll continue to build products. The market will be volatile. But I'm confident if you keep building, it will add more and more value. So yeah, I'm still very confident. I'm still working really hard. We are still working really hard. So, yeah, thank you so much. I'll see you guys later next time.