Binance CEO denies possible bank acquisition

Binance chief Changpeng Zhao (CZ) said the company is not interested in acquiring any banks due to regulatory complexity and capital requirements.

“Reality is much more complicated than the concept. You buy one bank, it operates in only one country, and you still have to deal with the regulators of that country. This does not mean that you can buy a bank and do whatever you want,” Zhao noted.

He added that authorities could easily revoke a bank’s license, especially when dealing with digital assets.

According to CZ, even if Binance buys a single institution, it would still need correspondent banks around the world, most of which are in the United States. Banks can restrict the use of cryptocurrency by not providing access to international transactions, Zhao says.

The Binance chief noted the high costs of running such a business and relatively modest returns. He also mentioned the difficulty of obtaining a license to acquire.

“Many banks do not have reliable business models. They are very risky enterprises. They take customers’ money, lend it out, and try to earn a profit. If they do not repay it, they declare bankruptcy. In many countries their governments will bail them out, but I don’t like doing such business,” Zhao says.

In the end, CZ said that Binance would consider small minority investments in banks, which could potentially influence the financial system’s attitude toward cryptocurrencies.

As reported in May, Zhao saw signs of a bull market due to a report on digital assets on Chinese television. He noted that this event sparked a real buzz in the country, which would positively affect the industry.