At the recently concluded Hong Kong Crypto Finance Forum, Binance founder Zhao Changpeng (CZ) delivered a heavyweight prophecy that could shake the entire crypto industry: in the next 10 years, decentralized exchanges (DEX) will completely replace centralized exchanges (CEX), and even giants like Binance cannot escape!
This is not alarmism, but rather a calm insight into the future from CZ, the man who personally built the world's largest crypto trading empire, standing at the pinnacle of the industry. He stated bluntly: 'Although Binance may be relatively large now, I don't believe it will always maintain the largest position.' This clarity and honesty itself signals that a profound transformation is brewing.
Why is DEX the inevitable future? CZ pointed out three key reasons:
The Pain of Regulation, the 'Achilles' Heel' of Centralized Exchanges: CZ lamented that centralized exchanges (CEX) have taken a huge hit on KYC (Know Your Customer) compliance, paying a 'huge price'. In contrast, the current DeFi (Decentralized Finance) field, CZ keenly pointed out, seems to have 'not much regulatory oversight' from institutions like the US, which brings a precious 'regulatory dividend period' for DEX. The historically burdened CEX giants face daunting challenges in turning around to chase this wave of dividends.
The 'Evolution' of User Experience: Don’t be scared by 'Decentralization'! CZ admits that the user experience of DEX is actually 'not bad', the core lies in whether users 'understand how to use wallets'. Indeed, today’s DEX interfaces are filled with addresses and contract codes, and operations require checking block explorers, while also being wary of MEV attacks, which is not very friendly to newcomers. This is also why most Web2 users entering Web3 tend to choose CEXs that offer email-password logins and customer service support. But the trend is irreversible! As users become more familiar with wallets and DEX technology rapidly iterates (CZ predicts that transaction fees will be cheaper than CEX in the long run), user migration is merely a matter of time. Just think, will users accustomed to frictionless trading be willing to return to the restrictive centralized platforms?
The Ultimate Dream of Asset Free Flow: CZ painted an exciting future scenario: future exchanges should break down all barriers, allowing all types of assets to trade freely on the same platform! Whether it’s Bitcoin, Ethereum, a skyscraper, future IP rights of a superstar, or even an individual’s 'worth', once on-chain, they all become just a Token. Technically? There’s almost no difference! New asset categories do not require major upheaval; they can simply issue a Token on existing public chains (like Ethereum, BNB Chain, Solana). The real barrier lies in compliance licenses, not technology. Once licenses are granted, a 'Universal Exchange' that pools global liquidity will emerge, with more efficient price discovery and maximized liquidity.
The Present and Future of DEX: Dividend Period and Final Battle
CZ also objectively analyzed the current state of DEX: Currently, many DEXs rely on token incentives to attract users, but this is not a long-term solution. 'You can't issue unlimited tokens—issuing unlimited tokens will lead to a decline in the existing token price.' These incentives will eventually fade. Right now, we are in the relatively early stages of DEX development, enjoying the dividends of token incentives. However, CZ firmly believes that in 5 to 10 years, DEXs will become 'very large'; in 10 to 20 years, their scale 'will definitely exceed' centralized exchanges. This is an unstoppable 'future trend'.
Although CZ stated that he would no longer personally lead related projects due to 'historical reasons', he revealed that Binance Capital (Binance Labs) has already 'invested in many similar projects' and is providing support behind the scenes. This is undoubtedly the strongest endorsement of the potential of the DEX sector! Where the big players' money and resources flow, often becomes the next explosive point.
The wheels of history roll forward and will not stop for anyone. CZ's prophecy serves as a warning and light for all crypto practitioners and investors. The golden era of centralized exchanges may be coming to an end, while a new world built on decentralized finance, where everything can flow freely, is speeding towards us. Will you choose to embrace the future or cling to the past? The answer may be hidden in CZ's heartfelt words.
Grasping the DEX dividends and planning for the next decade may be the wisest choice at this moment.
$BNB