The cryptocurrency market has plummeted more than 60% from its highs and Bitcoin has left 20% of its value on the ground in the last week alone. A situation to make even the most seasoned trader shiver. However, one of the richest men in the world thanks to cryptocurrencies – the founder and CEO of the world’s largest cryptocurrency exchange Changpeng Zhao of Binance – does not feel the same way.
“I’m not debating that it is disastrous. It is bad”,
Zhao said last Thursday in an interview with Fortune in Paris, also adding that for the brave, all crises also hide great opportunities for profit. “But when this disaster is happening, there is also opportunity”.
— Watcher.Guru (@WatcherGuru) June 23, 2022
Referring to future predictions for the market, Zhao did not give too much away but only stated that Bitcoin is likely to remain below its highs for at least the next two years.
“I think it will probably take some time to come back, given this price drop, from the all-time high of 68k to 20k. It will probably take a few months or a few years,” Zhao told the UK’s Guardian newspaper, “No one can predict the future”.
Bitcoin is at its lowest level since March 2020 and is struggling to climb back up to experience a rebound. But at the same time, the founder of Binance said that most cryptocurrency investors would be jumping for joy if someone four years ago had told them that in 2022 Bitcoin would reach $20,000.
“20k we think is very low today. But you know, in 2018, 2019, if you told people bitcoin will be 20k in 2022, they would be very happy. In 2018/19, bitcoin was $3,000, $6,000″,
Zhao told the Guardian.
The founder of Binance also explained that this is a normal phase of market weakness, considering the high volatility of cryptocurrency markets. At the same time, he reassured investors and users of the solidity of his exchange by stating in no uncertain terms that despite the collapse of token prices and the drop in markets, the company has no need to raise fresh capital.
This clarification became necessary after news broke that Binance had also temporarily suspended withdrawals last Monday (like the crypto lending company Celsius), apparently due to what it called a “blocked transaction on the blockchain”. However, when asked if the blocking of withdrawals was in any way related to the liquidity problems that the whole market is experiencing, Zhao replied:
“I don’t think it’s a pure coincidence. In market turmoil, there’s more transactions on a blockchain and many of the blockchain nodes do fail”.
Asked whether he believes a period referred to as “crypto winter” has arrived for the cryptocurrency market like in 2017/2018, Zhao replied that he thinks many projects will fail because they were created when the market was at its peak.
“Right now, it definitely feels many projects are in a bind because once you get to an all-time high, all the projects spend money like they were always going to be at that all-time high. So now when it drops it feels like during the winter. But for projects that have conserved cash, we’re still fine, we’re still hiring, we’re still growing”.