FILE PHOTO: Zhao Changpeng, founder and chief executive officer of Binance, attends a conference in Paris. Image credit: yahoo.finance
In a span of 72 hours, Changpeng Zhao, the founder of Binance, saw an increase of $8.42 billion in his net worth. This surge has elevated his total wealth close to $50 billion, marking a year-to-date increase of $13.9 billion.
Zhao’s wealth jumped from $39.9 billion to $48.3 billion as Binance’s share price climbed from $549.19 on March 22, 2024, to $554.30 on the morning of March 25, 2024, based on the Bloomberg Billionaire Index data.
A significant portion of Zhao’s wealth comes from his majority stake in Binance, the world’s largest cryptocurrency exchange by trading volume, with over 150 million users as of August 2023.
Binance’s revenue of $9.8 billion is calculated from the average of the company’s spot and derivative trading volumes over the past 12 months until March 2024, as tracked by Coingecko.com and CCData. The average transaction fees listed on Binance’s website, calculated separately for spot and derivative volumes, also contribute to this impressive revenue figure.
The updated revenue in March 2024 led to an approximate net worth increase of $11 billion for Zhao, highlighting the substantial growth of Binance and its founder’s wealth in the dynamic cryptocurrency market landscape.
Insights into Zhao’s fortune reveal that he holds a significant 90% stake in Binance, as stated in public announcements and filings where ownership details are publicly accessible.
Besides Binance, Zhao also owns Binance.US, a related exchange operating in the United States. In a fundraising round in March 2022, Binance.US achieved a valuation of $4.7 billion, with Zhao estimated to own an 86% stake based on its fundraising history.
However, Zhao’s stake in Binance.US faced a major blow when the exchange ran into legal issues. After a lawsuit by the Securities & Exchange Commission in June 2023, Binance.US decided to shift to a crypto-only model, discontinuing dollar transactions.
As a result, the exchange’s value dropped to zero, leading to a massive $1 billion decrease in Zhao’s total wealth. Besides his stakes in Binance and Binance.US, Zhao has investments in Bitcoin and Binance Coin, adding diversity to his cryptocurrency portfolio. However, the exact amount of cryptocurrency owned by Zhao is not disclosed, hence it is not included in his net worth calculation.
As of late December 2023, the Bloomberg Billionaires Index ranked Zhao as the 35th wealthiest person globally.
In early 2023, Binance, a key player in the cryptocurrency market, saw a significant increase in market dominance, capturing a remarkable 62% share of total on-exchange crypto trades in the first quarter. This was partly due to a zero-fee promotion for popular trading pairs, attracting users to trade on the platform.
However, after the promotion ended, Binance’s market share fell to 51% by the end of the third quarter, as per data from research firm CCData. This decline highlighted the difficulties Binance faced in maintaining its dominance amidst changing market conditions and regulatory pressures.
Binance increasingly found itself in conflict with the traditional financial system, facing regulatory scrutiny and legal action from government authorities. In June, the Securities and Exchange Commission (SEC) filed a lawsuit against Binance, alleging various violations and regulatory shortcomings.
Furthermore, in early 2023, the Commodity Futures Trading Commission (CFTC) launched regulatory proceedings against Binance, raising concerns about access for U.S. users, inadequate anti-money laundering controls, inflated trading volumes, and mishandling of client assets.
These regulatory challenges led to significant consequences for Binance, including a hefty $4.3 billion fine imposed by U.S. regulators.
Wow, CZ’s net worth just keeps going up Nearly $9 billion richer in just 3 days? That’s crazy volatility, even for the crypto market. Must be nice… though all those regulatory issues hanging over Binance can’t be fun. Feels like one lawsuit away from a major setback.
Hold on, this $8 billion jump seems fishy. Is it just a bump in Binance’s share price, or is there something else going on? Remember that whole zero-fee promo they ran to attract users? What happens when that kind of sugar rush wears off? Binance’s market share is already dropping.
This wealth disparity in crypto is getting ridiculous. Here’s one man raking in billions while the average crypto bro is still waiting for moonshots and lambos. The whole system feels rigged for the big players like Binance
CZ getting richer than ever while Binance gets sued left and right? Sounds about right for crypto. (meme about crypto volatility) This whole thing is a gamble, and CZ just rolled snake eyes. But hey, at least he can afford some good lawyers with all that cash.
CZ’s wealth increase is definitely impressive, and it reflects the continued growth of Binance. It’s great to see a homegrown crypto platform achieve such success. Here’s hoping some of that revenue goes towards further innovation and security improvements within the exchange