Binance’s founder says challenges related to fiat ramps can prevent the market from onboarding the next 100 million users.
Trouble seems to be brewing on the horizon for the crypto market as tight regulations forced traditional institutions to pull away from the industry, Binance founder Changpeng Zhao (CZ) told Insider at the Token2049 crypto event.
Speaking about possible difficulties barring another 100 million users from entering the market, CZ said converting crypto to fiat and vice versa appears to be the main issue nowadays.
“With tightening regulations in the earlier part of this year, we’re seeing a lot of traditional institutions that used to provide fiat ramp channels pull away.”
For Binance, crypto-to-fiat ramps have become a hot topic recently as weekly trading volume with traditional currencies on the platform has plummeted 60% since the beginning of 2023, according to Kaiko data.
In September 2023, the analysts added that fiat trading volume on Binance is down by 95% from its 2021 peak.
In June 2023, Binance’s European banking partner, Paysafe Payment Solutions, terminated its partnership with the exchange, citing regulatory challenges globally. Last month, the exchange stopped offering clients in Russia the option to pay one another through sanctioned banks shortly after media reported that the crypto giant was moving money from Russians abroad.
Binance, under the helm of CEO Changpeng Zhao, is currently dealing with legal and regulatory issues across the globe. The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against the exchange and Zhao, accusing them of deceptive practices.