Binance is ready to re-launch deposits and withdrawals on May 14, and somewhere down the road, they plan to launch their often hyped decentralized exchange (DEX). None of that changes the fundamental problems of what Binance is, and what it represents, though, and in his latest Medium post, Dr. Craig Wright picks apart the fallacies of the crypto market.
Titled “Crypto flim-flam,” Wright’s article looks into exactly what makes Bitcoin valuable, and why the product that exchanges offer is riddled with falsehoods. As the top crypto exchange in the industry, Binance represents a lot of what’s wrong with the industry, and Wright doesn’t hold back.
He first deals with the thought that trades on Binance somehow fall outside of the realm of U.S. law and regulation. That just isn’t the case, and they will pay for it eventually. He writes:
“Binance.com places the exchange squarely within the realm of US control. To say so is not a mere assertion, ‘.com’ domains have been considered to come under US territory for decades now. It is well tested in law.”
The big lie though is in the value people believe cryptos hold, and the trade of that value on exchanges like Binance. The true value of a token is in it’s worth to society, and the fact is, the vast majority of token’s are empty vessels. Binance gets rich by building belief that if cryptos become valuable from your trades, the common investor will get rich as well.
This has to come crashing down eventually, as worthless tokens with no use cases will have no reason to hold value eventually. Write notes, “Unfortunately, in this new round of growth of valueless assets and tokens that point to digital nothing, we will have to see the emperor in his full glory as the market for digital assets returns to its true value.”
Bitcoin SV (BSV), with its mission to scale massively and provide a new data network to the world, is the opposite case. It will prove to have uses as both the world’s new money, and the replacement to the Internet, making it an immensely valuable product. If the crypto market place doesn’t see that, the average consumer eventually will, and the tables will flip. Wright comments, “The exchange is Main Street, not Wall Street. (…) Value is what is offered to society at large. And markets come through use.”
The current rise in the price of Bitcoin Core (BTC) is very much an attempt of the crypto market trying to get as much wealth out of the market as they can before their house of cards comes crumbling down. That same fate will eventually happen for all the alt-coin scams that populate exchanges. Binance will keep that process going as long as possible, because they sell the promise of getting rich for nothing, whereas the real winner of this competition will be the token that provides value.
Wright concludes that there’s only one possible outcome to all of this: “In 20 years, we will look back following the massive crash that will come and see one surviving protocol.”
New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.