Author: Gu Yu, ChainCatcher

US President Trump announced a pardon for Binance founder CZ, which means that the US government has lifted the restrictions previously prohibiting CZ from operating financial business, and also created the prerequisites for CZ to return to Binance's front-line business and CEO position.

Following the announcement, prices of major cryptocurrencies generally surged. Considering Trump's previous pardons of several crypto individuals sentenced to varying prison terms, as well as the increasingly close relationship between crypto capital and the Trump family, this was interpreted as Trump's further positive stance toward the crypto industry.

This is indeed a significant moment for CZ. In response, he stated on Twitter that he will do everything he can to help the United States become the capital of cryptocurrency and promote the development of Web3 globally.

However, compared with these macro issues, the outside world is more concerned about what impact or adjustments CZ will have on Binance after leaving Binance's front-line business for more than a year. In particular, will his return bring more wealth effect to Binance?

In the nearly two years since CZ's departure, Binance's internal and external environment has undergone significant changes. From OKX's early launch of a Web3 wallet, challenging Binance in areas like inscriptions and memes, to Hyperliquid's significant market share in perpetual contracts, Binance has also seen significant growth. Meanwhile, major competitor Coinbase has acquired over a dozen projects in the past year to address shortcomings or broaden its product lines, including Deribit, Sensible, Spindl, and Opyn.

Perhaps influenced by its previous $4.3 billion settlement with the US government, Binance has maintained a restrained approach to product development and mergers and acquisitions over the past two years. Aside from the subsequent launch of a Web3 wallet, it has made few major moves. However, it was against this backdrop that Binance launched its blockbuster product, Binance Alpha. Leveraging its position in liquidity and influence, Binance successfully consolidated its advantages in user traffic and trading volume, driving the price of BNB to new highs.

However, while attracting a large number of users and providing considerable airdrops, Binance Alpha has become a target for many copycat projects to withdraw liquidity. Recently, there have been many incidents in which tokens listed on Binance Alpha plummeted, causing heavy losses to many retail investors.

Many believe that Binance Alpha's low barrier to entry for listing has negatively impacted the development path of projects and even the industry ecosystem. "This mechanism appears to benefit a large number of small projects and rekindle the potential of ICOs, but in reality, it creates an incentive trap that prioritizes short-term monetization over long-term development. To some extent, BN's monopoly isn't just about attention and liquidity; it's changing the rules of the game for the entire industry—replacing long-term development with a 'quick exit,'" said independent researcher Haotian.

From the outside, exchanges like Binance have become the ones exploiting all liquidity and premiums in this cycle. Jesse, head of Base, also sarcastically said, “Raise your hand if you’re ready to fight against CEX listing projects that charge 2-9% of token supply.”

For an exchange that pursues users and profits, these measures of Binance are understandable. All goals can be carried out around collecting more transaction fees. However, Binance exists as the "pillar" of the industry and has repeatedly positioned itself as an important builder committed to the development of the industry. The outside world's expectations for Binance are not only about its own status, but also about guiding and building the positive development of the industry.

CZ has not been directly involved in Binance's operations in the past two years. It is unknown how he will view and adjust the operating mechanism of Binance Alpha in the future. However, his series of remarks and actions on X involving BNB Chain and memes in the past period of time have already "annoyed" a large number of users.

For a long time, BNB Chain has been one of Binance's core strategic directions, but its ecological development has always been unsatisfactory, far less open and diverse than other chains such as Base. Major ecological projects such as PancakeSwap, Aster, Lista DAO, etc. mostly have Binance work and Chinese backgrounds, and are even directly managed by Binance employees. There are also few other ecological types besides DeFi.

Starting a year ago, chains like Solana attracted a large amount of user traffic by relying on memecoin, while BNB Chain failed to keep up with the market pace. CZ then actively or passively provided many personal elements (such as dog names, nicknames, and remarks), driving &BROCCO, $CZDOG, $4, $GIGGLE, $Binance Life and other BNB Chain-based currencies to surge and be listed on the Binance trading market, successfully allowing BNB Chain to gain a firm foothold in the memecoin wave.

However, CZ's involvement in the memecoin movement has led many to believe he's lost perspective. "As an industry leader, he shouldn't be leading retail investors in a frenzy of gambling on memecoins," said crypto influencer @cs_zhaozilong.

While Binance and CZ's contributions to the industry are undoubtedly indelible and significant, Memecoin's contribution to the broader crypto ecosystem is quite limited. If CZ simply rests on its own traffic and user growth, it will be difficult for the outside world to hold higher expectations. Especially in this context, can CZ lead Binance to further break through the ceiling of growth and compliance?

Even more unfortunate, Binance's fundamentals have recently come under scrutiny. Binance's role in the recent October 11th crash has also sparked widespread skepticism. Numerous crypto industry executives and influencers have blamed a malfunction in Binance's internal oracle system for the market crash. While Binance has issued a statement explaining the situation and compensated some users, this still reveals significant flaws in Binance's trading structure and risk management. Furthermore, this incident is not an isolated one.

While this is unlikely to shake Binance's leading position in the exchange market, it will inevitably have a negative impact on the crypto industry's image in the global public market, regulators' attitudes towards crypto trading, and Binance's overall competitiveness. This will be an extremely complex situation for CZ, which emphasizes industry responsibility.