- Changpeng Zhao (CZ), former CEO of Binance, has criticized the rise of memecoins, urging a shift toward blockchain projects with tangible utility.
- Despite his stance, Binance continues to list memecoins, raising questions about its alignment with CZ’s advocacy.
On November 26, Changpeng Zhao (CZ), the former CEO of Binance, publicly expressed his discontent with the dominance of memecoins in the cryptocurrency space.
In a post on X (formerly Twitter), CZ highlighted the disproportionate focus on these speculative assets, advocating for a redirection of resources and energy toward blockchain projects that deliver genuine value.
I am not against memes, but meme coins are getting "a little" weird now.
Let's build real applications using blockchain.
— CZ 🔶 BNB (@cz_binance) November 26, 2024
The Problem with Memecoins
Memecoins, such as Dogecoin and Shiba Inu, have gained enormous popularity since 2021, driven by high-profile endorsements from figures like Elon Musk. These tokens often lack substantial technological underpinnings, making them susceptible to speculative trading and extreme market volatility.
As of now, the memecoin ecosystem is valued at approximately $110 billion, accounting for 3.44% of the total cryptocurrency market, which is estimated at $3.19 trillion.
CZ argues that this fascination with memecoins undermines the development of groundbreaking blockchain applications. The focus on these tokens, he believes, attracts inexperienced investors who may not fully understand the associated risks.
This, in turn, damages the credibility of the broader cryptocurrency sector, fostering a perception of instability and speculation rather than innovation and utility.
Contradictions at Binance
Despite CZ’s public disapproval, Binance itself has faced criticism for its seemingly contradictory actions. While CZ calls for a move away from memecoins, Binance continues to cater to market demand by listing them on its platform.
For instance, on November 25, Binance Futures added two memecoins—Why (WHY) and Cheems (CHEEMS)—to its offerings. However, these tokens experienced sharp price declines within 24 hours of their launch, reigniting debates over the volatility and unpredictability of such assets.
This contradiction has drawn backlash from experienced crypto investors, who hold Binance partially responsible for the losses suffered by newcomers enticed by the hype surrounding memecoins.
On the other hand, some argue that Binance‘s actions merely reflect the existing demand in the market, suggesting that memecoins, despite their flaws, represent a segment of user interest that cannot be ignored.
CZ’s call for a pivot to utility-focused blockchain solutions highlights the ongoing tension between the speculative and innovative facets of the cryptocurrency world. As the debate continues, the challenge lies in balancing market trends with the long-term vision for blockchain technology.