Binance CEO Urges Crypto Buyers to ‘Hold On’ Amid ‘Unpredictability’

Binance CEO Zhao Zhao advised cash-strapped and inexperienced investors to stay away from cryptocurrency trading amid extreme market volatility and unpredictability.

On November 14th led by Zhao Ask Me Anything on Twitter, hosted According to Binance, the CEO suggested that simple investors should wait out the turbulent period instead of risking money for living expenses:

“You should not invest in cryptocurrency if you use money that you need for the next week or next month, you should only use discretionary money that you do not need for a long time, maybe a few years.”

For those with that spare cash, Zhao advised inexperienced investors and traders to think twice before deploying capital to the market in the near future:

“If you don’t know what’s going on, don’t try to guess what’s going to happen. It’s very hard to predict. So we’re going to go through a period of extreme volatility and unpredictability.”

He added, “Unless you’re very experienced, mature, very confident and can handle risk, I would recommend most people keep to this time period.”

The sharp rise in market volatility comes as the FTX crisis has had a negative impact on the entire industry – particularly a number of centralized exchanges having to pause withdrawals.

However, Zhao confirmed that there are no such issues on Binance. When asked why users should trust the exchange, he referred to the company’s balance sheet:

“We don’t have loans. We don’t have debts. We don’t owe anyone any money. Nor have we taken loans from the platform. So we never take user assets and give them to a third party to manage and try to generate returns.”

Zhao confirmed that Binance experienced withdrawals after the FTX crash and several other events that led to a decline in community confidence in the centralized exchange.

He reiterated that even if Binance collapses, the platform will not stop its users from withdrawing their funds.

If everyone withdraws their money from the central exchange, we will close the central exchange. We have many other profitable businesses that we own.

Related: Exchange outflows are at historic highs as Bitcoin investors remain self-custodial

Zhao believes that such an event is also entirely possible, noting that once decentralized finance (DeFi) applications become mainstream centralized exchanges may no longer be necessary:

“If we can get a way to allow people to keep their own assets in their own custody safely and easily that 99% of the general population can do, centralized exchanges wouldn’t exist or probably didn’t need to exist, which is fantastic.”

While the Binance exchange itself is centralized, Zhao emphasized that the company’s investment partners include centralized exchanges and decentralized protocols to provide users with choice and support entrepreneurs to build.

“We are technology agnostic. We are not trying to centralize everything. We are not trying to bring everyone onto a centralized exchange. If you are good enough to use a decentralized exchange, go for it.”