Crypto news

OKX founder and CEO Star Xu made an unexpected but highly telling statement: the increasing regulatory pressure on Binance worldwide is one of the best things to happen to the crypto industry in recent years. In his view, the era of "regulatory arbitrage," on which the largest exchange built its dominance for decades, is coming to an end. And this is not a reason for panic, but an opportunity for fair competition.

The discussion was sparked by reports that the Greek regulator HCMC may reject Binance's application for a MiCA license. Without it, the largest exchange risks losing the right to serve clients in the European Union as of July 1, 2026. Notably, OKX itself has already obtained a MiCA license through Malta, so Xu is speaking from the position of a direct competitor, but his argumentation appears much deeper than merely protecting his own interests.

The essence of the OKX head's position

Xu argues that many mistakenly perceive increased scrutiny of Binance as a threat to competitors. On the contrary, for over a decade, competition in the crypto sector has been defined not by product quality, but by the ability to operate outside the rules. Companies that ignored licensing and compliance gained an unfair advantage over those that invested resources in adhering to regulations.

Now that regulators are bringing Binance to uniform standards worldwide, this advantage is disappearing. Xu emphasizes that competition should be based on products, technology, execution, and trust, not on the number of jurisdictions where the law can be circumvented. His main thesis: regulating Binance is not a threat to the industry, but a positive event that levels the playing field.

What Xu accuses Binance of

According to the OKX head, Binance's success was built not only on technology and liquidity, but also on the ability to create and promote narratives around crypto assets. The exchange built a vast ecosystem of founders, former employees, venture funds, and related projects that received priority listings and access to a retail audience. Meanwhile, many tokens lost over 95% of their value after launch.

Xu describes this as a "self-sustaining cycle": when one narrative fades, a new one immediately emerges. Insiders and early participants reap disproportionate benefits, while losses fall on retail investors. Instead of focusing on losses from the previous cycle, users are encouraged to concentrate on potential profits in the next one.

He specifically criticized Binance's compliance, calling it a transition "from refusing regulation to paper regulation." After a series of enforcement actions and the four-month prison sentence of founder Changpeng Zhao, the company changed its public stance and began presenting itself as "one of the most law-abiding in the industry." However, Xu notes that what matters is not the number of hired specialists, but whether the programs are aimed at managing real risks or merely creating the appearance of legal compliance.

He also raised the issue of shifting regulatory risks to separate entities, pointing to Binance's exit from Russia through the sale of its business to CommEX and the exchange's connection to the Aster project, whose operating model resembles the Hyperliquid platform previously criticized by Changpeng Zhao.

My analysis: Star Xu's statement is not just criticism of a competitor, but a clear signal to the market. Regulatory clarity, however painful it may be for giants like Binance, creates a healthy environment for innovation in the long term. Investors will increasingly choose not the exchange that makes the most noise, but the one that offers real value and transparency. The "Wild West" era in cryptocurrencies is ending, and that is for the better.