OKX CEO Star Xu: Regulatory pressure on Binance is a benefit for the entire crypto industry
In the crypto community, there is a prevailing opinion that increased regulatory pressure on Binance, the world's largest exchange, creates risks for the entire ecosystem. However, OKX CEO Star Xu holds a diametrically opposite view. In his belief, the global regulation of Binance is one of the most positive events for the industry, marking the end of the era of so-called "regulatory arbitrage."
For many years, Binance's key competitive advantage was its ability to operate in jurisdictions with minimal requirements. Companies that pursued licensing and compliance implementation found themselves at a clear disadvantage. Now, as regulators worldwide bring Binance to uniform standards, this advantage is disappearing. According to Xu, this is a fundamental shift.
The End of the "Gray" Scheme Era
Xu argues that Binance's success was built not so much on technology or liquidity, but on skillful narrative control and creating a self-sustaining cycle. The exchange, he says, created a vast ecosystem of insiders, former employees, and venture capital funds that received privileged access to listings. Meanwhile, many tokens lost over 95% of their value after launch, with losses borne by retail investors.
"Competition should be built on products, technology, and trust, not on the ability to circumvent rules," emphasizes the OKX head. He also criticizes Binance's approach to compliance, calling it a "transition from avoiding regulation to paper compliance." Xu notes that after a series of enforcement actions and the prison sentence of founder Changpeng Zhao, the exchange changed its rhetoric but not its essence. What matters is not the number of hired specialists, but whether programs are aimed at managing real risks or merely simulating compliance.
Separately, Xu mentioned Binance's exit from Russia through the sale of its business to CommEX and the exchange's connection with the Aster project, whose operational model resembles Hyperliquid — a platform previously criticized by Zhao himself. In his view, this indicates attempts to shift regulatory risks to separate entities rather than a genuine change of course.
My analysis: Star Xu's position is not just criticism of a competitor, but a clear vision of the market's future. The "Wild West" era in cryptocurrencies is ending. Those who bet on transparency, real compliance, and responsible treatment of users, rather than loud narratives, will define the new industry landscape. The regulation of Binance is not a threat, but an inevitable and healthy process of market maturation.