With Bitcoin ETFs looming, crypto ‘could get very exciting, very fast’: Binance Australia boss
Just before the end of 2023, Stockhead caught up with another major crypto exchange boss – Binance Australia’s Ben Rose. It’s fair to say, he’s pretty bullish about 2024.
Crypto exchange Binance, as a global entity at least, faced various challenges in 2023 – some of which perhaps helped lead to the resignation as CEO of Changpeng Zhao (aka “CZ”), the founder of the platform. CZ is awaiting a sentencing hearing in the US regarding alleged anti-monetary laundering and sanctions violations.
That said, the Binance behemoth has barely missed a beat when it comes to growth, continuing to add a significant amount of users around the world, including Down Under.
To grab some highly encouraging outlooks on the crypto market and industry, we spoke to Ben Rose, general manager of Binance Australia, New Zealand and Pacific.
Hi Ben. 2023 turned out okay for Bitcoin and crypto as a whole – a hell of a lot better than 2022, anyway. What do you attribute that to? BTC ETF hype perhaps?
I think any success visible in the market comes down to the hard work of those in the industry who have been focusing on building during the recent bear market.
The talent across our industry has shown real resilience and belief in crypto and web3, despite the naysayers and those who would see us fail. I see it every day across our business, with a team focused on the long term growth and adoption of crypto. It’s something I’m proud to be part of and that is an important factor in the success of this new and growing industry.
And of course there are macro factors globally, regionally and closer to home. The emergence of regulatory frameworks around the world has marked a new chapter for crypto, giving clarity to exchanges and consumers alike. When done well, these build confidence in retail investors but also enable institutions and traditional financial players to enter the space. We’ve seen this coming for a while, and it’s certainly started to pick up in recent times.
Do you think we’re truly in the beginning of a bull market here for crypto? The “disbelief” stage, perhaps?
There are certainly a lot of factors aligning to create an exciting 2024. We’re seeing growing understanding, adoption and acceptance of Bitcoin and crypto more generally, both locally, regionally and globally. The future is pretty bright.
At Binance we talk about the next billion users. I think the key things that are going to push this to the next level will be regulation and new capital inflows.
Regulation, because it gives confidence in the standards of platforms. And we’ll have this landing in Australia soon. And new capital inflows because many, many more investors will be able to access the benefits of this exciting asset class.
What catalysts do you think will play out this year to spur the market along? Just how big do you think a Bitcoin spot ETF approval in the US would be for the market? What sort of effects do you think it could have?
There’s strong discussion around ETFs and we know regulators are engaging extensively with applicants, with hints towards announcements expected soon.
This would be a significant development for the space, as it will open the floodgates to potentially game-changing amounts of new capital entering the sector. This has understandably created some real excitement in recent months.
And do you think that excitement is building not just within crypto, but from certain institutions looking in?
That’s right. Following some famously vocal naysaying all around the world, many of the major traditional financial institutions are getting involved in blockchain and crypto initiatives now.
Looking close to home, we’ve got major banks like NAB and ANZ who have engaged in significant blockchain projects, working with innovators and regulators in the space. This is a microcosm of a global trend that we see in all major markets where many banks are either launching their own products, purchasing exchanges or partnering with them.
Are there any remaining headwinds for the industry that give you pause for thought, though? Or is the bullish ETF narrative just too dominant right now?
When I look at the calibre of the institutions applying for ETFs and their historical success rates, that gives me real confidence. They are doing this because their customers are calling out for it. There’s a groundswell from global investors, calling for exposure to this market.
Which makes sense – with the Bitcoin white paper, crypto started as a grassroots phenomenon and grew from there to become so popular that traditional financial institutions have now decided to join in and reflect the needs and wants of their customers.
With ETFs, these institutions will be giving their customers a whole new way to invest in this asset class – it’s expected to onboard a whole lot of new people. Just think about the scale of it. The entire crypto market cap is around USD$1.5 trillion. BlackRock, just one of the ETF applicants, has assets under management of $9.4 trillion. This could get very exciting, very fast.
Are there any crypto narratives/niches/sub-sectors you feel particularly positive about for 2024?
I don’t think 2024 is going to be about niches and sub-sectors. I think 2024 is going to be about crypto going mainstream. Mass adoption.
We’re already seeing lots of new customers dip their toes in the market and come into the sector (you can see some research on that here) and we expect that to continue. We’re excited about bringing the freedom of money to more Aussies.
Where are we at in Australia with the regulatory aspect for crypto? Is there a light at the end of the tunnel on regulatory clarity here? Or still just frustratingly taking too long?
The news that Australia is going to get a licensing regime was really well received by the industry. Not all jurisdictions have announced what their licensing framework will look like, or if they will even have one. The fact that Australia has gone and done that puts us at the forefront globally. This was not an insignificant task and the approach is a strong one.
The consultation was well thought out and a huge amount of work has gone into this by the Treasury, ASIC, and others. They’ve worked hard to engage the industry in designing a licensing framework that will deliver consumer protection whilst maintaining the ability of Australian-based businesses to innovate.
We’ve seen the focus placed on this by the Commonwealth Treasury, with the regime discussed by Treasury Minister Stephen Jones at many industry events. It will be a key moment for the industry to mature and be recognised, making sure that all of those in the industry do the right thing by their customers.
What’s in store for Binance Australia in 2024? Tell me why it’s going to be a better year than 2023 for your lot?
A lot has happened this year for Binance Australia, but we’re really excited about the future. It’s been a challenging year as a team and as a business. We’ve spent a lot of time in build mode, bringing fantastic talent into the team, and doing a lot of work around our strategy and product set.
We’ve faced some significant challenges but been heartened by the support of our loyal users and friends across the industry.
Got any results to back up the encouragement you’re feeling?
Yes, and despite what some detractors have said, we’ve been proud to see a trading volume of over AU$20 billion in the year to end of November. Australians have been voting with their clicks – we’ve seen trading volume growth start to ramp up between 40-80% over the last few months.
But overall we’re looking forward to putting 2023 and the bear behind us and doing what we’re all here to do: growing the adoption of crypto and contributing to a vibrant, successful financial ecosystem in Australia.
We see 2024 as a transformative year for Australian crypto and for Binance Australia. Regulation is on the horizon, the market is heating up and we have a fresh, talented and experienced team who are fully focused on the opportunity ahead.
We’ll undoubtedly see changes in the sector with some consolidations, exits and new entrants. Our goal will be to continue earning the trust and loyalty of our users, growing this market and showing that the ANZ region can be a global leader.
What has been your take on CZ’s resignation from his role as CEO of Binance as a global organisation? Does it feel like a fresh new era for Binance broadly?
Both locally and globally, Binance has made some big changes as we’ve evolved the company. CZ grew an incredible business to an incredible scale within just six years. But now, I’m excited about the new era we are entering under the leadership of our new global CEO, Richard Teng.
Richard has over three decades of financial services and regulatory experience in major financial markets. His profile is reflective of the new talent that has joined the company in the past few years, including in Australia where many of our team have a trad fi or regulatory background.
Our ANZ team couldn’t be more excited about being part of this transformation and bright new future.