I think for Bitcoin to hit a million dollars will be a good thing. I actually don't think we need 25 years. I think it's gonna happen much quicker.
CZ Chungpen Xiao, the founder of Binance at Bitcoin Asia in Hong Kong discussing what could define the Bitcoin century in the decades ahead. I think we need Bitcoin payments to happen on massive scale. I think we need Bitcoin to be a retirement pension fund reserve.
All of those things will happen. If we're heading towards a world with billions of AI agents that can automatically buy, sell, negotiate, and transact. What money are those agent going to use?
They will probably start with a stable coin. Once you can accept a stable coin, it's very very easy to add Bitcoin. It's also possible some of the large AI companies, they may want to issue their own tokens.
I've had discussions with multiple very large, the top tier AI companies about how to issue tokens. Some of the AI companies I talked to, they want to build hundreds of gawatts over the next couple years and that's going to cost trillions of dollars. If you're allocating the reserves of a country today, what's the percentage that you recommend them to allocate to Bitcoin?
My recommendation is pretty simple and it's a little bit self- serving. I usually recommend them to take the top five cryptocurrencies and just allocate according to market cap percentage wise. That's the easiest, simplest, and most market driven approach.
So, typically it be like no 50 something% in Bitcoin and then 20% ETH and then B&B will get in there. So yeah, as we can see here, the majority of the people have been believing for a long time that Bitcoin will be bigger than gold. How could we all be wrong?
Well, I think there's a very Hey everyone, one of our absolute favorite things at when shift happens is to look at our data to improve what we're doing for you every single week. And one of the things that we notice every week when going through our data is how many of you regularly watch this podcast but still have not subscribed. And so if you want to help us get even better guests every week, take two seconds and click that subscribe button just below this video.
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We're calling this session the Bitcoin century. What would have to happen over the next 25 years for you to look back and say that was really the Bitcoin century? um for um I think for Bitcoin to hit a million dollars would be a good thing and it will happen.
Do you think we need 25 years for that to happen? And no, I actually don't think we need 25 years. I think it's going to happen much quicker.
But more than price, uh I think we need more a lot more utility. Um I think we need Bitcoin payments to happen uh well on a massive scale. Um I think we need Bitcoin to be a retirement pension fund reserve.
Um it will get there. Uh all of those things will happen. Um a lot more will happen but um um and the yeah um all of for 25 years I think all all of those things will happen.
Yeah. What's the biggest thing people today are underestimating about the transition that's needed to truly cement this century as the Bitcoin century? I mean you mean this whole century this whole century is a long long time.
Um so uh I think what somebody said it's very people tend to overestimate what they do in one year but underestimate what they do in 10 years. A 100 years is a long time. Um so even in the next 10 years I would say uh a lot of the infrastructure will get built.
Um I think we're seeing the shift like in the last two years we saw a huge shift in traditional finance attitudes towards Bitcoin right so um and even in the only in the last year or so in the last few months we're seeing tokenized stocks going up like uh uh uh tremendously and this is just the beginning we only like what um I guess BTO Binance Bto was only launched a couple months ago like maybe three two three months ago um is already growing very quickly. So if you think about 10 years um that's going to be huge. Um and uh and that's just one small sector.
Not a small sector but that's just one sector. Um so with other sectors um there's multiple other sectors payments AI uh aentic um finance infrastructure um stable coins um tokeniz tokenization. there's a lot of things that will happen over the next 10 years.
So I think yeah um that uh many things will happen. Um so I think yeah we're actually at the best point in time um compared to any time in history. There's so many opportunities right so so many opportunities right in front of us.
Uh we just got to take advantage of it. Yeah. You mentioned tokenization you mentioned payments.
How is that linked to Bitcoin and the success of Bitcoin? Um, I think they all help each other. Um, I think the Bitcoin blockchain doesn't really handle tokenization today.
So, all the tokenization happens on other blockchains, but in the crypto industry, what's good for Bitcoin is good for everything else. Um, what's good for, you know, another blockchain or another uh sector is actually good for Bitcoin as well. Um, they help each other.
People who learn about who people who learn about Bitcoin eventually learn about other they will eventually into other blockchains, other tokens, etc. Um and people who come in through a tokenization uh of today of stocks um eventually will look in bitcoin right so today like say right now we're in Hong Kong um people in Asia who wants to buy US stocks it's very hard for them to get a brok brokerage account um and of the very few people that get brokerage accounts in the US it's very hard the timing is wrong right so um you can't trade from like 11 pm to 4 a. m.
every day. Um so, uh once that's tokenized, you will democratize access to the stock market, but so the people who used to want to buy US stocks could that couldn't and now able to but through crypto through crypto platforms. Once they on the crypto platforms, they will probably know have some exposure to Bitcoin that they they did not have before.
So over time, that will compound. So um uh what's good for tokenized stocks um is actually good for traditional uh uh stock markets but also good for Bitcoin. So I think all of those things help each other.
It's a it's truly an ecosystem. It's now one project versus another. Bitcoin started as a technology for individuals and it's now becoming a strategic asset for institutions and potentially nation states.
Does Bitcoin ultimately weaken governments or does it make the governments that adopt it early significantly more powerful? And why? Um, okay.
I think on this point, Bitcoin itself doesn't weaken or strengthen governments. It's what governments do um uh that strengthen or weaken them. Uh some governments like a lot of power.
They want total control, etc. uh in human history that may not always be the best for the economy for the citizens. What we've seen that uh many countries with weaker governments actually do better in with in economy.
Um so if you look at the US government for example, the US government is actually a small it's a large country. So it's a large government but relatively speaking it's a less powerful government. The people are only in power for four years and then the government change.
Um and then you have two parties um they debate all the time it's inefficient right there just a lot of debates but it's actually a weak government but the weak government may have contributed to one of the strongest economies in the world right so u having weaker government may or may not be a a bad thing and you can see that the current SEC in the US they said no they give up a lot of their power they say we don't we don't regulate this this is not in our reg uh per purview and actually the indust indry has grown because of that, right? So, um when when when when the powerful people, the regulators have less power, sometimes the industry grows better. Uh whereas compared to the US previous SEC administration, Gary Gensler wanted everything in his power and that actually that actually stopped growth completely.
Um so, um so uh but Bitcoin itself the the it's just a technology. It doesn't give um it doesn't give power to more people here. uh one one side or another uh the more the the technology is decentralized so it does give a bit more power to the individual uh so you have more sovereign control of of your currency but at the same time um I think Bitcoin's design um the privacy aspect of it is somewhat flawed so it's very it's actually very very easy to track transactions on the blockchain and so that aspect actually weakens uh some of the privacy control aspects Um but both of these aspects doesn't u a government can use it or not use it.
So if a government said like in potentially but I don't think this happening in any country yet. If the government says holding Bitcoin is illegal in their country whether that law is makes sense or not uh is fair or not u but some governments may be able to push a laws through in many countries the government can totally push a law through like that. When the government does that uh then you know the econ this sector is not going to develop in that country or or maybe a more practical example some countries say look we're gonna we're going to apply a 36% tax on every transaction right that's going to kill the industry the government will have a lot of control u the government the government will be very powerful but they will not have any tax revenue because uh charging 366% of zero is still zero whereas if you charge like know I don't know 6% uh of 100 of one trillion that's a lot of money right so u I think the technology doesn't dictate the the government the government decides how much power they want to have and the in countries where the citizens can vote uh the voting determines that yeah quick shout outs to our legendary long-term wind shift happens partners without whom none of this would be possible thank you to cast my go-to global money app to store earn move and spend stable coins across 170 20 plus countries directly with Apple Pay or a physical card.
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However you want to invest in crypto, the experts at Bitwise have you covered. How seriously are governments taking Bitcoin today? Um I think most governments are taking it relatively seriously but many um but today many countries still don't have crypto regulations right.
So mo many countries don't have crypto regulatory frameworks. uh it's actually only a handful of countries that does. Um so uh I think many people in governments understand Bitcoin but they are probably still a minority.
Um so and also especially uh many countries the government are slightly they run by elder people. So um it's like a slightly older generation and that generation actually logically adopts new technologies slower. Um and they of they also read more traditional news uh which are usually more negative on crypto and all all this other uh things.
So uh they tend to have a slightly more negative mindset. But I but I certainly feel the shift. I meet many different um country leaders uh politicians uh in different parts of the world.
The shift is definitely happening. No one's denying that you know this is a new technology. No one's uh denying that you know uh they need to adopt it.
Um but sometimes they still have the skewed view that all Bitcoin is used by drug lords. Um is that true or not? But more and more people are explaining to them now that no that's not the case.
Yeah. When you meet these leaders, do you feel like they're meeting you and looking at this Bitcoin thing because they have to to look good or because they have to for the future of their country to be more successful? Um actually almost every country leader I meet are the second of the latter.
They want their country to be better. Um so uh but to be to be but to be frank I think there's quite a lot of countries who are doing it just because they have to. But most of those countries you can detect them pretty quickly.
They adopt some kind of framework. It's usually overly restrictive. is usually like you know just a PR job and the implementation and the licensing takes forever or or or impossible um and um nothing really happens on the implementation level um so of the countries that usually invite me to go and um they're usually very progressive that they're sincerely wanting to adopt crypto so it's a pretty good benchmark like you see which countries I visit those are usually the crypto friendly countries when you're advising a major government today.
What do you tell them about Bitcoin that they're probably not doing yet? Um, well, there's many uh there's many parts, right? So, uh number one is putting a crypto regulatory framework.
Um that's uh usually and also once you have a framework uh how do you what what's good about it and what's bad about it? How do you revise it? Um how do you re uh uh how do you improve it over time?
uh most people uh most of the crypto regulatory frameworks fall into a few parts. Right now many people are focused on either the centralized exchanges which is usually the past few years this and last year many countries are focused on stable coins which is good um um because US genius clarity uh there's a lot of debates and there's a lot of attention on that um many countries are not doing a crypto reserve so I usually advise them to do a crypto reserve um that's usually much better that's usually very important for the country long term uh many country are not issuing their own stable coins uh or um so we need we need to get their own currency onto the blockchain so that you know they capture liquidity in their own currency. Uh they also promote uh liquidity for their own currency on the blockchain.
Um many country are thinking about tokenized assets uh like in addition to stocks uh traditional financial instruments but like you know rare earth minerals uh real estate culture arts IP um so there's a lot of discussions on those fronts and many country are very interested in tokenization because they view that as a way to attract money into the country um and or have assets that are available to be for people to buy outside of the country. So quite a lot of those discussions are happening. Yeah.
What are the countries that you think are doing that the best? Um different countries are moving at different pushing different parts of the envelope. Um which is which is good.
Um I think UAE has probably the most progressive crypto regulation today. Um uh ADGM Abu Dhabi Global Markets give binance. com a global license to operate almost all of their products.
Uh which is fantastic. Um and then um but UAE still have not issued major stable coins yet. But I think I hear some discussions there.
So they're progressing. Um I think US uh is moving pretty much more much more heavy on the stable coin side. They're very focused on the stable coins.
Um uh and the exchange regulation is they just use the old sort of MSB money transmitter license etc. Uh and but right now I I my impression is the CFTC is moving pretty fast on sort of a a f federal level uh futures, derivatives, licenses, etc. which is which is fantastic for the industry.
Um I think Japan is pretty pretty pretty forward um right now. Um Hong Kong is moving pretty quickly. Uh Singapore I think is a little bit more conservative today.
Um so but all of those countries are moving pretty quickly. Um Pakistan uh I think Bala was here um earlier. I just had I just had a meeting with him earlier.
Pakistan's moving pretty quickly. But Pakistan the regulations moving quickly but the uh implementation is not quite there yet. Um for example, Binance does not have a bank account there yet.
Uh like a client money bank account there yet, but I think that's underway. Um they haven't issued stable coins yet. Um so all of those those things need to happen.
Uh Kazakhstan is moving very quickly. Um Binance has very good banking support there. Um, Binance Pay works with QR codes everywhere there.
Kyrgystan is very happening very, very soon. So, I'm visiting those two countries next week. Uh, so there's quite a lot of countries moving pretty quickly.
Yeah. Tell me about one major government that you think is currently getting Bitcoin completely wrong. Um, I think that's I I don't want to name any specific countries to make them look bad, but I think many countries view Bitcoin as this dangerous thing.
Uh, it's not. uh is Bitcoin is much more dangerous if you don't use it. Um so um basically you're missing out.
If you think about AI, which country doesn't want to hold AI technology themselves, right? So not investing in AI technologies, not promoting the AI industry in your country is dangerous for you. Uh using AI, well AI has some dangers, but using AI properly will be fine.
So u I think there's a there's quite a lot of misconceptions about Bitcoin, crypto, etc. in in a few different countries. Yeah.
You mentioned strategic reserves and that you're advising governments to actually build a strate strategic reserve. If Bitcoin becomes a strategic reserve asset for nations, does it eventually become more important than gold? For sure.
I think Bitcoin will for sure become more important than gold. Yeah, I think today uh what we got to understand for large countries to change it takes many years, right? So today they have mechanism to value gold um to hold gold.
Uh there's a there's a whole mechanism there. Um for them to shift into bitcoin will take some time uh or into crypto will take some time but it will happen. So and um bitcoin is just a much better asset than gold.
Um I think Peter might might not agree but I've had that debate with him before. Um but you know bitcoin is much more important. Yeah.
Thank you. Well, [applause] as we can see here, the majority of the people in this room believe or have been believing for a long time that Bitcoin will be bigger than gold. How could we all be wrong?
Um, I think there's a very Okay, I think there's a very small chance uh something better than Bitcoin takes over like another digital currency that's that grows faster than Bitcoin overtakes Bitcoin before Bitcoin takes over gold. Um that's a I think this by by everything that we're looking at today the chance of that happening is quite small. I think Bitcoin will overtake gold pretty soon.
Um there's only like a 10x difference right now. So who knows in the next bull run it could happen. If you're allocating the reserves of a country today, what's the percentage that you recommend them to allocate to allocate to Bitcoin and why?
Uh my recommendation is pretty simple and it's a little bit self- serving. Um, I usually recommend them to take the top five cryptocurrencies, uh, take out stable coins that they they may already have a US dollar reserve. Take the top five cryptocurrencies and just allocate according to market cap, uh, percentage wise.
That's the easiest, simplest, and most market driven approach. So, typically you'll be like, no, 50 something% in Bitcoin and then, I don't know, uh, 10 20% in ETH and then B&B will get in there. So, yeah.
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Why would that make sense? Why would you know just not advise them to allocate only into Bitcoin? It's a Bitcoin conference.
I guess there's a lot of Bitcoin maximalists here. And also if people understand what Bitcoin is, they might just say like this is the only one that makes sense. Sure.
I think as Okay. I think as uh as as much as I think the organizer of this conference, David Bailey is a Bitcoin maxi. Uh and he's a good friend of mine too.
Uh very good friend. Um I think look if the industry only have Bitcoin, it's actually the industry will grow much slower. Having the this other blockchains does not take away from Bitcoin.
having all these other block having Ethereum having BME chain having other blockchains actually helps to grow the Bitcoin as well. I think Bitcoin will be smaller if we didn't have other blockchains. Bitcoin would not be bigger will be smaller.
Um and um uh what's good for Bitcoin is also good for the other blockchain uh for uh for the other blockchains. So it's we're in an industry that this is not a zero sum game. It's not like you know uh we're taking anything away from each other.
Um, Bitcoin service as a service uh has its own utility. It's it's it's the most it's the largest market cap. It's the most decentralized.
It's going to be the reserve currency for a very long for a very long time to come. But the other blockchains have more innovation, right? It's easier to try new things on on the other blockchain and then if Bitcoin can reverse adopt it, then great.
Um so uh I think most Bitcoin maxes also realize that you know um it's realize this it's not it's not always the best to only promote Bitcoin. Um so for me um I I'm very a strong proponent of Bitcoin. Uh this is a Bitcoin it's called Bitcoin Mina or Bitcoin Asia uh conference.
Um but in the early days the the whole crypto industry is called the Bitcoin industry. Uh we only we only started calling it crypto. Actually crypto is not not a very good name.
Like most people most normal people when they hear about crypto they think like no it's too scary. It's too mathematics driven right. Most ma non-math majors um they they they feel distant from it.
Um uh web 3 is is is not web 3 is a okay name. So I think the ter the terminology and label doesn't matter very much. I strongly think that we should push the industry as a whole.
Um there should be multiple blockchains, multiple exchanges, multiple per uh dexes, multiple per dexes, uh multiple of everything. U so that there's competition, there's more innovation, there's more uh just just just more pushing. So um uh I I think like we should we should this industry is about decentralization.
We should adopt the open approach that we accept multiple of everything. Um and it's not this one versus another. Yeah, we spent the last decade proving that B bit Bitcoin can exist.
What actually is driving the next cycle? Uh I'm not too sure to be very frank. Um I well I think right now if we look right now if we look this uh RWA and AI both are very strong and the the previous ones stable coin will continue to grow.
Uh centralized exchanges will continue to grow. Decentralized exchanges will continue to grow. Um um memecoins will continue to grow.
NFTTS will probably make a comeback of some kind. Um so D5 MM are continue to grow. So I think multiple things will continue to grow.
I don't know what the next hot thing is. Um that's very hard to predict. Um you know um in the beginning of 2017 um I would not have predicted ICOs but you know half a year later we were doing an ICO.
um when the NFT craze was happening six months before that I would not be able to predict it. So um it's very hard to predict predict the next thing um I think it's up to the entrepreneurs like know in this audience and out there that you know um that creates those next bark uh the next big hot things. Yeah you mentioned AI.
Let's talk about AI. If we're heading to towards a world with billions of AI agents that can automatically buy, sell, negotiate, and transact, what money are those agent going to use? Uh, for sure it's going to be crypto money.
Yeah, I mean the Yeah, but which one? Uh, again, I would think that what they will probably start with a stable coin. Um, and then once you once you can accept a stable coin, it's it's very very easy to add Bitcoin.
And then hopefully it's equally easy to add B&B, Ethereum, um, Salon, other blockchains as well. And then um, and also it's also possible some of the large AI companies, they may want to issue their own tokens. So they'll probably jamming that, gem that in there.
I've had discussions with multiple very large the top tier AI companies about how to issue tokens. Uh there's many different there's many different schools of thought thoughts right so um or very early like know building data centers requires a lot of money um like one gawatt of one gigawatt of compute takes about somewhere between 30 to 50 billion dollars and many of them are running out of money to as high valuations as they have uh many of them do not have enough money to to to to build that kind of compute power uh some of the AI companies I I talked to they want to build hundreds of of gigawatts over the next couple years and that's going to cost trillions of dollars, right? So, u they talked about know how to potentially issue a data center token so that um get later on you can get rewards uh from that data for to use that data center.
Uh if you're going to issue a token, you want to increase the utility of that token as much as possible. So naturally, you want to allow that token to be paid for subscription services. Um and then do you want to tie that with different language models, different services, etc.
So there's many different models to tie that. So it's not inconceivable that a AI company will issue their own utility token and try to promote that. I think we've seen that you know some tokens being already issued by companies very closely associated with open AI right so the workcoin um uh even though today I think it does not have a huge amount of utility yet uh but you know uh those guys are very close to to to the AI companies.
So I think uh crypto work uh when when when when AI handles payments for us um they will use crypto and also but today I think the AI payments may come after AI trading. So like paying for hotels, paying for bills etc. Uh using AI agents um based on my conversations with some of the top tier AI companies um today payments is not their priority.
They're trying to make the agents smarter to find you the best deals, but they don't view that payments is a big problem to solve today by AI. Mo most people can swipe their credit card to book hotels once the AI finds the best hotels for them. Whereas in trading, uh AI may have to uh AI is more appropriate because you have to gather a lot of information very quickly.
You have to react very quickly to news uh to other analyze the charts. uh however you want however you do your trading AI can probably facilitate that process uh by improving effic efficiency by 10x and then to do that you don't want to you don't want AI to do the analysis for you and you press a button to trade yourself you want the AI to place the orders for you uh uh for efficiency reasons or for timing reasons so AI will probably trade for you before they they pay for you so that means that whether we're in a human world or an AI world bitcoin mostly stays a a technology for savings. Bitcoin for savings and then we have stable coins or or crypto for machine to- machine commerce or for trading.
Um I think so to a large extent yeah I think that's going to be the next step but I think as people use stable coins more and more for payments uh many of the payments will shift towards native crypto like the bitcoin payments uh many people are not used to the bitcoin price fluctuation but once the payments once the payment rails are fully open accepting crypto or the guys holding bitcoin will no longer convert them to stable coins because the guys who hold bitcoin long term they don't care about the fluctuations they don't want to convert to a to a fiat currency pegged value and then hold that. That's just another extra step. Um like for me, right, I hold BNB and uh and some Bitcoin.
I mostly spend BNB. Uh when I spend, I don't I don't I don't sell BNB into US dollars and hold it there and then spend. Sometimes I do that, but that's very inconvenient.
But when I swipe the Binance card, um B&B gets deducted based on how much I spend. I don't care what the exchange rate is. Um uh you can fluctuate.
It's going to fluctuate upwards. um I just I spend on whatever whatever the price is on that day on that on on that minute I just spend it. So I think as long uh initially people will do payments in stable coins but as the payment rails become more widely available um people just going to spend the cryptocurrency that they hold.
Yeah. This session is called the Bitcoin century. What do you hope CC's contribution to the to that Bitcoin century will have been?
Um I actually don't know. Um so I my my mentality is always I try my best. Um so um if I if my abilities are low I'll just contribute a little bit.
If my abilities are high I'll contribute a bit more. Um so so far I believe I've made decent contributions to the crypto industry to the extent that I that I could. Um I will continue to do my best to contribute um to the extent I can.
Yeah. Thank you so much CZ for this and thank you everyone for your attention. Thank you so much.
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