In a candid and insightful conversation during a live X Spaces session, Changpeng “CZ” Zhao, the CEO of Binance, unveiled his intriguing predictions for the future of decentralized finance (DeFi). According to CZ, the cryptocurrency industry will experience a significant transformation, with DeFi poised to outshine its centralized counterpart, known as CeFi, during the next bull market.
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Expressing his bullish stance on the decentralized movement, CZ emphasized that as the cryptocurrency landscape becomes more decentralized, it naturally evolves into something better. He projected that DeFi, with its current trading volumes hovering between 5% to 10% of CeFi volumes, is on the brink of a substantial breakthrough:
"DeFi is the future; the volume is somewhere between 5% to 10% of CeFi volumes, which is not small right [...] the next bull run may very well make DeFi bigger than CeFi."
The Rise of DeFi
CZ’s optimism isn’t unfounded. Recent events have showcased DeFi’s impressive potential. Following legal actions against centralized exchanges like Coinbase and Binance by the United States Securities and Exchange Commission (SEC), the top three decentralized exchanges (DEXs) witnessed a staggering 444% surge in median trading volume within a mere 48 hours, as reported on June 9 by Nosisnews. As of now, DEXs collectively boast a 24-hour trading volume of 692,157,925 underlining their growing influence within the crypto space.
![Binance CEO CZ forecasts DeFi outgrowing CeFi in the next bull run image 9](https://i0.wp.com/nosisnews.com/wp-content/uploads/2023/09/image-9.png?resize=1024%2C509&ssl=1)
![Binance CEO CZ forecasts DeFi outgrowing CeFi in the next bull run image 9](https://i0.wp.com/nosisnews.com/wp-content/uploads/2023/09/image-9.png?resize=1024%2C509&ssl=1)
During the session, CZ also touched on a significant legal development that could be a game-changer for DeFi. He lauded the recent dismissal of a class-action lawsuit against Uniswap, a prominent decentralized protocol. The lawsuit was brought forth by plaintiffs who claimed they suffered losses due to fraudulent tokens on the platform.
The judge’s decision, which highlighted the challenge of identifying scammers and the impact of regulatory ambiguity, was hailed as a positive development for DeFi builders by CZ. He stressed that the protection of developers and their freedom to write code as a form of free speech is crucial, marking a significant stride toward greater industry protection.
This shift is mirrored by venture capitalists who are increasingly reallocating their investments from CeFi to DeFi projects. In 2022, digital asset investment firms channeled $2.7 billion into DeFi ventures, representing a remarkable 190% surge from the previous year. In contrast, CeFi projects witnessed a 73% decline in investments, amounting to $4.3 billion, during the same period.
These developments indicate a compelling trend: DeFi is rapidly emerging as the high-growth sector within the crypto industry, marking an exciting chapter in the industry’s evolution.
Related: Binance's New Payment Product Aims to Boost Crypto Adoption in Latin America