CZ at Davos 2026: Why is the new regulatory framework the key to crypto?

Recent statements by CZ at the Davos 2026 Economic Forum, among influential global figures like Trump and Elon Musk, have painted a very different picture from the traditional narrative about crypto. Instead of talking about an upcoming “revolution,” CZ focuses on a more practical issue: how to build an appropriate regulatory framework to truly integrate crypto into the global financial system. This is the perspective of a leader who has experienced multiple market cycles, not a philosophical idealist.

Payments: Crypto does not replace, but integrates with TradFi

CZ believes that the payments sector faces urgent problems, but the solution is not for crypto to “break” traditional finance, rather to deeply integrate the two systems. In his vision, crypto will serve as a new infrastructure layer, offering faster speeds, lower costs, and superior flexibility. However, this does not mean that the entire traditional payment system will disappear. Instead, this combination will create a hybrid ecosystem where old and new technologies coexist and complement each other.

Bitcoin and memecoin: Clear differentiation between assets and speculation

CZ has shown a rather pragmatic attitude, not trusting Bitcoin as a daily payment tool, and warning about the high risks of memecoin. This observation reflects a market reality: Bitcoin is increasingly becoming a store of value rather than a means of transaction, while memecoin largely still relies on psychological momentum and liquidity issues. This differentiation is natural and necessary for the market to mature.

Physical banks: When regulation cannot save outdated models

CZ predicts a significant decline of traditional physical banks over the next 10 years, not because crypto directly “knocks them down,” but because the current banking model is too costly, too slow, and no longer suitable for the 24/7 digital transaction world. Although banking regulators try to adapt through flexible regulation, their fundamental models are already outdated. Crypto only acts as a catalyst, accelerating this transition faster than usual.

Regulatory passport: A breakthrough for global crypto adoption

CZ’s idea of a “regulatory passport” is bold but practical. He recognizes that creating a unified global regulatory framework for crypto is nearly impossible, so he proposes an alternative approach: if a company receives a license from a country with a sufficiently reputable regulatory regime, that license could be recognized by other countries. If implemented, this would be a huge step forward for the crypto industry, drastically reducing legal costs and paving the way for companies to scale globally instead of being divided by national borders. This is the kind of innovative regulation the industry needs for sustainable growth.

Systemic risk: The issue is not technology but regulatory design

An important observation from CZ is that faster, cheaper technology does not automatically make the system riskier. The core issue is not technology but the fractional reserve model, where liquidity is always an illusion until a trust crisis occurs. Crypto, at least in its design, is much more transparent in this regard. This indicates that a proper regulatory framework will be more important than technological approaches in building a safe and sustainable financial system.

Next steps: Growth lies in the gaps of the current system

In summary, CZ no longer talks about crypto with a “revolutionary” tone, but from the perspective of someone who has experienced multiple cycles: crypto will not replace the entire current system, but it will infiltrate the weakest points and gaps of the traditional financial system. Those gaps, where the regulatory framework cannot meet the needs, will be the true areas of growth in the next decade.