From CEX to CeDeFi: Binance's On-Chain "Breakthrough" and Ambition

Centralized exchanges (CEX) are entering a deep-water competition for the on-chain trading market. In this new market landscape, Binance is forging a unique path of integration. Following the concept of "CeDeFi," first proposed by its founder Changpeng Zhao (CZ) in 2020, Binance isn't simply seeking to combine CeFi and DeFi. Instead, through technological integration and ecosystem synergy, it aims to blur the boundaries between the two, allowing users to seamlessly enter the on-chain world. On September 1st, Binance launched a web wallet rebate program, offering rebates of up to 80% on transaction fees. Just a few days ago, on August 25th, OKX announced that it would charge a "UI service fee" for trading on some currency pairs on its DEX aggregator, and simultaneously launched an invite-only rebate program. At the time, Binance founder CZ boldly predicted that "DEX trading volume will surpass CEX within the next 3-5 years." Although he later extended the timeline, his core judgment has never wavered: decentralized trading is the ultimate and irreversible trend. Whether facing internal competition from traditional rivals or the surge of DEXs, CEXs are inevitably rushing to the on-chain battlefield to launch a new battle. However, a barrier seems to always exist between centralized trading platforms and the free and open world of on-chain. The complexity of on-chain operations, in particular, creates a high barrier for users to enter the market. Breaking through this barrier has become a core challenge for CEXs. The recent rapid rise of Binance Wallet has provided the industry with a solution.

Binance Wallet Breaks Through

The on-chain battle among exchanges is essentially a battle for the entrance to Web3. On-chain wallets have become the "vital point" in the new competitive landscape. The "explosion" described by Bluebird is a universal perception. This year, Binance has launched a carefully orchestrated "blitzkrieg," leveraging Alpha 2.0, the TGE (Token Generation Event), and Booster mission incentives to attract a large number of users to the on-chain world for the first time. The wealth effect generated by a series of token-based incentive programs has become an effective means of attracting users. According to statistics, in early TGE events, users participating in token subscriptions for projects like Myshell, Particle, and KiloEx achieved peak returns of 1130% to 3412%. In this regard, it's crucial to note that Binance, as a leading trading platform, possesses significant advantages in brand, traffic, and ecosystem resources. On the user side, Binance boasts over 280 million registered users and a long-standing reputation. By offering early participation opportunities and revenue incentives through activities like the Alpha airdrop, Binance can easily attract a large number of users, foster word-of-mouth communication on social media, and gain even more incremental users. Through Alpha 2.0, Binance has proven the effectiveness of its "Converged Account" system. With a hybrid architecture featuring "on-chain trading and CEX clearing and settlement," users can seamlessly move between CEX and on-chain, achieving seamless asset transfers. This innovative solution bridges the gap between centralized and decentralized exchanges, improving user liquidity, capital efficiency, and accessibility. It will undoubtedly accelerate Web3 user growth and lay the foundation for the digitization of traditional finance. In CZ's view, future exchanges should enable unified trading of all types of global assets, from a building to a celebrity's future IP rights to even personal wealth—all tradable in a single market. This will not only maximize liquidity but also make price discovery more efficient. To realize this vision, breaking down the barriers between CEX and DEX is essential. Binance's practice shows that future competition will no longer be a division between CEX and DEX, but rather a question of who can more efficiently integrate and seamlessly connect. It provides the entire industry with a viable path for CeDeFi and indicates that the competition in crypto-financial infrastructure has just begun.