In his usually-positive manner, Binance CEO Chanpeng Zhao does not think that WeChat’s recent but shocking ban on crypto trading transactions is a bad thing. Even though the ban is a big blow to those who are interested in buying Bitcoin, Zhao was almost calling for a celebration.
Chinese Social Media Giant Turns Fire-Breathing Dragon on Crypto Assets
In a post on social media by Dovey Wan, founding partner of Primitive Ventures, WeChat published a payment guideline and in it, the banning of merchant accounts taking part in Bitcoin trading was duly announced. Accounts that flout the rules by issuing tokens or even raising funds on crypto trading transactions will be shut down. According to Wan, the ban is definitely going to have a major impact on the Chinese cryptocurrency market. This is because a vast majority of the over-the-counter (OTC) crypto trading activities are done on WeChat.
Zhao Sees A Different Thing
But as stated earlier, Binance CEO Chanpeng Zhao believes that the ban imposed by WeChat is not a bad thing at all. On his Twitter page, he posted and described the ban as nothing but a temporary pain that will produce gain on the long run.
This is a classic example of short term pain, long term gain.
It is inconvenient for people short term, and they take a hit. But long term, it is precisely this type of restriction of freedom that will push people to use crypto. Not a bad thing.
— CZ Binance (@cz_binance) May 7, 2019
Analysts observed that this is not the first time that WeChat is going to come down heavily on cryptocurrency trading activities. In August 2018, WeChat rolled out a number of restrictions which prevented users from making use of the Bitcoin wallet and other cryptocurrency activities. The restrictions and the ultimate ban are both part and parcel of the overall Chinese government policy of clampdown against cryptocurrency activities.
As a matter of fact, just in April, a report published by the Chinese government detailed how the leaders were planning to shut down mining of crypto coins in one of the world’s biggest economies. Zhao insists the deal is a good one for the industry. In fact, he praises the ban as a positive move. He said that even though there will be short-term issues and the prices can even tumble, it will be a lovely thing for the crypto world at the end of the day. He said that it was the same tyrannical restrictions and prohibitions that led to people inventing the crypto in the first place. He believes that with WeChat and other applications clamping down on cryptocurrencies, more users will change course and focus on digital assets.
Doubts or Reality?
Obviously, not everyone is as positive as Zhao. In fact, some analysts are saying cryptocurrencies will not witness a surge of new users simply because it was banned by WeChat. To make things even more complex, Zhao himself refuses to give more details on his projections. Those who are pessimistic about the ban argue that the measure only affects merchants who are currently involved in or hoping to work with cryptocurrency. They also believe that the ban is an effective move against the progress of cryptocurrency considering the fact that China is the most populous nation on the planet.