On March 27, Changpeng Zhao (C.Z.), the CEO of Binance, one of the world’s largest cryptocurrency exchanges, tweeted, “When one door closes, other ones open,” in response to the recent crackdown by U.S. banks on cryptocurrencies.
According to the C.Z. phrase, the opening doors are those of China, while the closing doors refer to the state of cryptocurrency firms in the United States (U.S.), where digital firms face strict crypto regulations.
As per the reports by the Straits Times, Chinese state-owned banks are vigorously courting cryptocurrency companies. This development follows the Chinese government’s move to endorse the adoption of digital currencies in Hong Kong.
The United States cryptocurrency industry faces strict regulatory restrictions imposed by watchdogs, which has raised concerns about its future. There is growing apprehension that the sector might disappear from the U.S. altogether. Consequently, several banks have already suffered setbacks, including Signature Bank and Silicon Valley Bank (SVB), which have collapsed under the weight of these regulations.
On March 12, regulators took control of Signature Bank, citing the need to contain the spread of contagion. However, one of the bank’s board members, Barney Frank, stated that the bank had enough liquidity to remain operational. He believed the regulators’ motive behind the takeover was to send a stern warning against cryptocurrencies.
Since then, many prominent individuals have shared similar accounts of facing equal treatment from authorities. Caitlin Long, the founder of Custodia Bank, disclosed that her firm was subjected to coordinated efforts to deprive it of a Fed master account and membership in the Federal Reserve System.
