Changpeng Zhao, founder and CEO of Binance, the biggest cryptocurrency exchange by volumes traded, pondered the importance of decentralization and the relation it has with security and freedom. Zhao stated that there are several aspects of decentralization and that this is part of a gradient scale, explaining the different ways in which even Bitcoin can be seen as centralized.
Binance CEO Changpeng Zhao on Decentralization and Its Degrees
A lot has been said about the benefits decentralization brings to cryptocurrency projects and how it differentiates some initiatives from others. Changpeng Zhao, CEO of Binance, pondered on the importance of decentralization and how this characteristic must not be the objective, but a tool to achieve several objectives related to a cryptocurrency project.
In a blog post published on October 9, Zhao explained that decentralization was not absolute and that there are several key aspects to it. He explained:
Every aspect is a gradient scale, not simply black-and-white. It is also important to remember that decentralization is a means to the goal, not the goal itself. The goal is freedom, security, and ease of use.
According to Zhao, each one of these aspects might make different projects (even Bitcoin) seem centralized, depending on what is being considered.
CEXs Still Important
In the same way, Zhao remarked on the importance that centralized exchanges (CEXs) still have. According to Zhao, most people still use centralized exchanges as a way of keeping their cryptocurrency secure, as most people are still not able to keep their funds secure with the tools available today. He declared:
That’s why CEXs are more popular today. Centralized exchanges provide an incremental step for users to access crypto and can act as a bridge between centralized and decentralized systems.
Zhao makes these statements on the heels of a large exploit in which an unknown attacker was able to take control of 2 million BNB, causing validators to stop the Binance Smart Chain blockchain to patch the hack. The action was heavily criticized due to the speed at which the validators of the network coordinated to stop the chain to avoid further losses.
However, Zhao declares himself to be a believer in decentralization, saying that the exchange will keep investing in the development of solutions that allow security and freedom to go hand in hand in the future.
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