New Binance Currency Listings: How Will This Affect the Crypto Space?
Coinbase is arguably the first exchange that comes to mind when you are trying to buy Bitcoin or Ethereum with your credit or debit card? If you are a crypto trader, then you’d agree that it can be quite cumbersome and time-consuming trying to use different crypto exchanges for transactions.
World’s largest crypto exchange, Binance, is set to introduce its first fiat pairings. According to CEO Changpeng Zhao (aka CZ), the China-founded crypto exchange will “soon allow customers to convert digital tokens into fiat currencies.”
Zhao revealed to Bloomberg that this stride is coming after months of planning and shifting bases in order to evade restrictive regulations. The exchange has moved from Japan, to Hong Kong, and now to Malta, where it has been able to open a bank account. Less stringent regulations from Malta will enable Binance open a local subsidiary platform that will enable crypto-fiat trading pairs, starting with Euro-Bitcoin.
Although crypto markets have dwindled since January, this year, Binance has continued to record remarkable strides. While the markets have suffered steep decline in crypto market caps, Binance has managed to grow their userbase from two million in January to nine million by June. What this reveal is that even though the markets are bearish, new users are still coming in. On this note, it is only natural that fiat pairings become the next step to take. More customers will be able to easily buy cryptos directly from their banks on Binance, and trade it with hundreds of other cryptos.
Binance has strong ties with some crypto-friendly regions around the world, and it is rumored that they are in talks with authorities and banks in Taiwan. Also, it is expected that the exchange opens an office in Jersey, with a staff of about 100 people. The Jersey Financial Services Commission is quite receptive to virtual currencies and introduced “cryptocurrency sandbox” legislation in 2016. Additionally, this may open doors to Sterling pairings, since the local economy of Jersey is based on the pound (GBP). Sadly, US citizens may have to wait a bit longer, since CZ revealed that there are no immediate plans to incorporate USD pairings.
A quick look at CoinMarketCap, and you will see that almost all the top cryptos react to the price of Bitcoin; increasing when Bitcoin is increasing, and going down when Bitcoin does. Altcoin fans have often decried the pairing of bitcoin with other cryptos, which makes them subject to the volatile price swings of bitcoin. A fiat-crypto pairing will not only make it easier for newbie traders to enter into the market and buy their favorite coin, there will also be greater liquidity to the market. This could potentially reduce the importance of Bitcoin as the bellwether for the market as a whole. On the flip side, it will become more likely for altcoins to be valued based on their inherent value or product, instead of hinging on bitcoin.