Benefits of Crypto - to Countries

This article is originally published in LinkedIn by Changpeng Zhao, CEO of Binance. 

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While there is a misconception that cryptocurrency are bad for governments and countries, we believe the opposite is true. Blockchain technologies and cryptocurrency will be mainstream. It’s inevitable. Just a matter of time. Early individual adopters have already become billionaires, as evident from the latest issue of Forbes. The same applies to governments. Early adopters will become new financial leaders of tomorrow. The opportunity is right in front of us, now!

Proper understanding, early adoption and intelligent governance of the cryptocurrency industry is key. Crypto exchanges are at the heart of the cryptocurrency industry. Supporting regulated exchanges to operate in a country will have significant positive effects on the local economy.

Attraction of Funds

Wherever big exchanges are, they will draw in other crypto projects and businesses. This leads to a huge influx of funds to the local economy, in hundreds of billions of dollars (USD), from all over the world. Crypto investments are borderless. Good ICOs are invested in by people from all over the world.

Attraction of Talent

Crypto businesses are lead by the sharpest minds on the planet. They are early adopters and developers of technology and financial industry. They push the envelope forward. Clear and favorable regulations on how ICOs are accepted by governments, listing on exchanges, and competitive personal tax policies are key to attracting these talents.

Local Job Creation

Crypto businesses are well funded. In 2017, crypto businesses raised $5.7 billion USD from ICOs, bigger than VC investments in the same year. In Jan of 2018 alone, crypto businesses already raised more than $2 billion USD, and the trend is accelerating. These businesses must hire people to grow their teams, creating job opportunities in the local community.

Tax Revenue for Governments

Unlike startups in other industries, cryptocurrency startups are often profitable from the beginning. Some are extremely profitable (see later). These profits generate significant tax revenue for the government, often in hundreds of millions of USD for each business.

Industry Growth

In addition to the direct tangible benefits, there are significant intangible and long term benefits, which we believe, far outweigh the immediately quantifiable ones mentioned above.

With more crypto business booming in one area, they will build a local culture that is crypto friendly and crypto advanced. This is similar to the startup culture in San Francisco, financial culture in New York, etc. With this culture built, it will help to shape the local economy, to be a world leading one. Early adopters could realize trillions of dollars in benefits compared to late adopters.

Benefits Binance can Bring

Binance is the world’s largest cryptocurrency exchange. In the first 3 months from inception, profits amounted to $7,500,000 USD. In the 2nd quarter, profits amounted to $200,000,000 USD. The 3rd quarter is still in progress, and is expected to have further growth. Any country that can attract Binance to open a branch in their location will receive a handsome tax income revenue.

Binance is a leading brand in the crypto industry. Wherever it lands, it will attracts other crypto businesses to follow. Binance has listed more than 200 coins, many of them are also looking to open branch offices around the world. They will follow.

Binance is aggressively recruiting, and is projected to recruit over 2000 employees this year alone, and even more next year. This will help grow the local job market.

Binance also have incubation and charity funds, further helping the local startup economy and welfare.

We are happy to work with forward thinking regulatory bodies, share our experiences and expertise, and help forge a leader in tomorrow’s blockchain-enabled world.

Countries

Initially, smaller countries with developing financial markets have the most to gain by adopting blockchain technologies. This should have less disruption to their existing institutions, as well as being easier to manage given a smaller size. As adoption in these countries increase, larger countries with established financial markets will feel the disruption. In this line of thinking, established financial markets should adopt blockchain technologies as early as possible too. As the saying goes, it is always better to disrupt yourself than waiting to be disrupted by others.

Whether you are representing a nation that is looking to lead for the next century, or a responsible officer that aims to keep your organization relevant, we hope you are that forward thinking body that is daring to disrupt yourself to maintain/become a leader of tomorrow.