Changpeng Zhao explains what makes Binance successful

This article belongs to the “CZ Q&A” series of articles. The opinions expressed in the article are personal opinions and do not represent the official position of Binance. This article does not constitute any financial investment advice and does not guarantee the correctness of the views.

I am very happy to see that the situation of the epidemic has improved recently, and there have been more opportunities to go out and talk face-to-face. I am always asked a lot of questions, one of which is “Why is Binance so successful?”

Of course, this is a topic that needs to be talked about, so I choose to sort it out in words.

First, I want to correct some common misconceptions.

“Binance got big because of their brutal, reckless growth approach.” I hear people say this a lot, but it really goes against the truth.

Users invest their hard-earned money, and they are most afraid of encountering a “desperate” platform. Therefore, users will definitely do their own research and find a platform that they can trust. Only a platform that wins the trust of users can grow.

There are also many people who say “Binance is big because…”, all of which are only given a single reason. But this logic is too singular. These factors have played a role in Binance’s growth, but many other factors have also played a role at the same time. And even in this article, I can only list some of them, not all of them.

To be successful in one thing, many tasks need to be perfected, in addition to luck. Failing is much simpler – just screw up one of the tasks.

However, the world is not that complicated. I think these “many tasks” fall into three broad categories: users, services, and products. None of this is unique to Binance, but we try to be the best at each of them.

The first is our values.

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User first

Many platforms say they protect users, but the values ​​are not in words, but in actions. Users are smart, they can detect it. Here I will give a few examples of what Binance has done (and other platforms have not) in order to live up to the value of user security first.

On July 14, 2017, Binance raised the equivalent of $15 million and had a successful ICO in Shanghai. Just one and a half months later, on September 4, the Chinese government announced that it would prohibit the operation of crypto asset trading platforms and ICO activities in China, and stipulated that all projects that have conducted ICOs must return the original amount of funds raised to users. At that time, BNB was lucky and had risen to 600% of the ICO price. Just imagine which trading platform would be willing to return funds to users at a ratio of 1:6? And at that time, there were also four projects on the Binance platform that had ICO, and their tokens were all lower than the issue price.

These project teams did not have enough funds to return to users, and by our calculations, the difference was about $6 million. Our team had a quick conference call while I was still on the train. In just 10 minutes, we unanimously decided to use Binance’s cash reserves to return to users, including the return amount of those four projects.

To this day, this payout remains Binance’s largest ever, taking more than 40% of the entire cash pool. At that time, we were only officially established for 8 weeks, and we were not profitable and constantly burning money. The cost of recruiting and developing was very high, but we still adhered to the value of “customer first”. No trading platform has been able to do this before us (nor after us as far as I know). After we announced this decision, we received tremendous support from the community, and a large number of users flocked to the Binance platform. By protecting users, we gain more new users as a result.

Second example. Once when we reconciled the accounts, we found that there were more GAS coins in the wallet, which made us worry all of a sudden – is there something wrong with the system? After a thorough investigation, we found that as long as NEO is stored in the wallet, GAS coins are generated, which is another token, but also has value. At that time, all platforms would not issue GAS coins to users who hold NEO, and Binance was the first trading platform to do so. We calculated the user’s NEO holdings in days and then issued the user their due GAS accordingly, because it was not our money but the user’s money. Guess what happened next? Most NEO users have migrated their funds to Binance.

Likewise, Binance became the first platform to support airdrops and forks of exchanges. Before that, users need to withdraw coins to their wallets, wait until the airdrop or fork is completed to get new coins, and then recharge the original coins to the platform. Binance decided to save users this hassle, and the platform handles forks and airdrops directly, sending new coins directly to users’ wallets. In this way, it not only saves the trouble, but also allows many users who are troubled by technology to enjoy the benefits of airdrops and forks. This approach has greatly improved user retention rates, leading many platforms to imitate them, and making the entire industry pay more attention to consumer protection.

There are countless such examples. Binance is the first platform to help users recover tokens lost due to operational errors, even when Binance itself does not list the token (such operations require a lot of manpower and time costs); more particularly What’s more, even when users don’t use Binance platforms (such as DeFi), Binance does its best to help users keep track of their funds; recently, Binance has conducted security measures for users’ funds lost due to technical failures in the data center. amount of compensation. As you can see from these examples, protecting users is a matter of time and money, but it is also the best way to attract and retain users. We encourage other trading platforms to do the same.

Go to Binance Official Website

Service first

When users start trying to use a platform, you have to find a way to keep them, and to do this, I think the best way is to do good service.

Before Binance provided online customer service, it was not uncommon to wait two months if you sent an advisory ticket on the exchange, and two weeks was considered lucky to get a response, which was often about funding ( Bitcoin or other encrypted assets), such as the inability to withdraw cash, etc. Binance decided to change this status quo, promising to reply within 24 hours, and within 1 hour at the fastest. The response has been enthusiastic, and a wave of new users has poured into Binance. Later, the entire industry was forced to follow suit, so we actually improved the service level of the crypto-asset industry to a certain extent.

Currently, Binance’s online customer service function usually responds within a few minutes for the first time in more than 12 languages. Of course, there is still a lot of room for improvement, and we are working in that direction.

In addition to helping users solve problems encountered on the Binance platform, our customer service staff will also do their best to assist users with other problems.

Binance is also the first platform to help users recover funds sent by mistake. This service usually extracts the private key from the secure environment and then performs some custom operations, which takes a lot of time and labor costs, but for us, the investment is worth it.

Binance even once helped users track funds lost to DeFi scams on Ethereum, even if those funds did not flow into Binance. So, sometimes you see headlines like “Binance Squid Coin Project Fleeing,” when in fact we were not involved, but our reputation could be damaged. However, in order to help users, we still choose to go back and forth.

Even when users suffer from mobile phone number transfer scams, the Binance team reaches out to help users protect their crypto assets in various situations.

There are many more such examples. Maybe new users know very little about our efforts, but such an experience is a valuable asset that will eventually translate into word-of-mouth on the platform.

Go to Binance Official Website

Product Innovation

When we decided to do Binance, a lot of people said to me: “Don’t be a trading platform anymore, it’s over, the market is saturated, and you can’t replace any one of them…” There are similar arguments.

But when we really got to know the market, we found that there is so much room for improvement.

In 2017, most trading platforms had a “novice interface” where users would swipe up to see a chart (usually a very basic one) and then swipe down to place an order. But according to our experience in the trading field, this operation is not in line with the habits of most traders. We feel we can do better. Later, Binance designed two versions of the single-page trading interface, and all the charts, order books, orders, trading buttons, etc. to be viewed are set on the same page. Soon after, many trading platforms in the industry adopted this design.

Faster. Performance is one of the characteristics of the product. Binance’s matching engine is the fastest in the industry even today. Click on a trade order, and the difference in response speed between Binance and other platforms is visible to the naked eye. Binance’s API performance is also the fastest and most stable in the industry.

more currency. In 2017, most trading platforms were still “Bitcoin trading platforms”, focusing on fiat-bitcoin transactions, with very few listed currencies, and even some large trading platforms did not list ETH. But 2017 was also the year when IC0 broke out. Many new coins were created. People wanted to own these coins, but they suffered from the lack of a liquid market. So Binance decided to list multiple coins to fill the gap in demand.

Fees are lower. In the early days, Binance charged transaction fees 10 times lower than others; today, Binance remains the platform with the lowest transaction fees in the world. Many other platforms put a lot of effort into marketing to attract new users, but in the end, these users come to Binance after they understand the market. In the future, we may reduce existing fees even lower.

International Perspective. When Binance was founded in 2017, there were two platforms with the largest trading volume at that time, Poloniex and Bittrex. However, both platforms are centered on American users, only provide an English interface, and do not support other languages ​​except English, and are headquartered in the United States. We set our sights on the world, Binance launched 9 languages ​​in the first month and has now expanded to 31. Our customer service supports 12 languages, the most of any trading platform.

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Conclusion

One sentence summary: There is no secret to success, only by sticking to your own values, creating good products, and continuing to provide users with better services. So, I would like to thank all Binance team members, including Binance Angels, for their hard work, focus, and contributions. Finally, I would like to say that Binance is not perfect, we are still working hard, sticking to our values ​​and constantly improving our products and services. If you have any comments, please feel free to give us feedback. Thank you for your continued support and companionship, and Binance looks forward to continuing to work with you to achieve global monetary freedom.

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