TL;DR: The charismatic Binance CEO, Changpeng Zhao (CZ), confirmed Alipay allowed its massive customer base to on-board with fiat for the exchange’s recently-launched China franchise. Almost immediately, the world’s largest online payments platform formally denied any association. Not too long after, CZ began an attempt at placing the secret genie back in its bottle, shushing those who wished to argue Alipay’s denial was little more than social media public relations. It’s a classic example of the maxim Loose Lips Sink Ships, and a fascinating glimpse into how business is done in the largest officially Communist country on Earth.
Binance CEO Confirms, Then Walks Back Alipay Fiat China On-Ramp
“There’re several reports about @Alipay being used for bitcoin transactions,” the payments provider explained. “To reiterate, Alipay closely monitors over-the-counter transactions to identify irregular behavior and ensure compliance with relevant regulations. If any transactions are identified as being related to bitcoin or other virtual currencies, @Alipay
immediately stops the relevant payment services.”
Alipay is so huge even a tacit, under-the-table allowance of providing a way for 1.4 billion Chinese to trade on Binance would be a very, very big deal — so big, you’d want it known, even if by way of a social media wink. The China-based unicorn is the outgrowth of Jack Ma and his Alibaba Group, and has long-since passed the likes of PayPal for mobile payment platform dominance. Alipay users are inching up on a billion as of this year, and the company already has more than half of the market in China.
When Haiyi (Celine) Lu, founder and CEO of mining outfit BitDeer, asked, “Is #Binance now accepting fiat on-ramp with #Alipay and #Wechat pay? Exciting news… would love for someone to confirm,” CZ seemed eager for a humblebrag. “YES,” CZ emphasized in all caps. Binance had only recently announced moving into the coveted Chinese market, itself a giant score in terms of potential. Win it, and any exchange would be sitting pretty probably forever.
Some Confusion by Some News Outlets
And just as emphatic came a, “NO, you cannot” from Alipay, along with the above longer statement, stressing its public position on the matter. “Some confusion by some news outlets,” CZ seemed to retreat after being summarily rejected out of hand by Alipay, “@Binance is not working directly with WeChat or Alipay. However, users are able to use them in P2P transactions for payment. Still not a small feat. But words/meaning get twisted as they are passed around.”
When asked directly about the WeChat component and purchasing crypto on Binance, CZ answered, “they can, just in a P2P transaction. Buyer pays the seller directly.” And that might’ve settled things, providing enough nuance to convince observers a simple linguistic slip-up was made, nothing more. Enter crypto researcher Larry Cermak.
Cermak (see above) revealed his personal professional, behind-the-scenes conversations with those in the know who insisted both Alipay and WeChat are “very well aware” and “willingly let it happen” with regard to Chinese authorities allowing financial businesses “to turn the blind eye” in such cases. He went further, describing how trades, as CZ apparently confirmed before walking-back the entire assertion, occur rather regularly. The system has cracks, Cermak pointed out, and everyone knows it.
Muddying the waters further, CZ jumped back-in to the conversation, seemingly warning all who would take up the subject in public. He told Cermak “somethings are better left unsaid. Recommend no more news like these, for the sake of the people, our industry (and our business).” Cermak has since deleted the exchange between himself and CZ. Business in China is notoriously comprised of navigating the country’s official Communist Party positions and economic reality. It could be the case CZ momentarily forgot how amplified his words are, and, more importantly, how loose lips sink ships.
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