Binance’s co-founder and CEO, Changpeng “CZ” Zhao, has witnessed a staggering decline in his net worth by $11.9 billion. This comes in the wake of reduced trading volumes on the Binance exchange.
📰Bloomberg’s Assessment
On October 26th, the Bloomberg Billionaires Index revised Binance’s revenue projections downwards by 38% due to the slump in trading volumes. This adjustment pushed Zhao to the 95th position on the global rich list. Currently, his net worth stands at $17.3 billion, a sharp drop of 82% from its zenith of $96.9 billion in January 2022, where he occupied the 11th spot among the world’s wealthiest individuals.
📰Trading Volume Woes
Data from crypto aggregators CoinGecko and Coinpaprika, used by Bloomberg’s index, revealed a consistent decline in Binance’s spot trading market share. From over 55% in January, it dwindled to 34.3% by September. Binance.US, the American subsidiary, also experienced a dip in trading volumes.
📰Legal Troubles
Binance and Zhao are currently embroiled in legal battles with the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). The SEC’s lawsuit alleges that Binance operated without proper authorization, engaged in the sale of unregistered securities, and mishandled customer assets. The CFTC’s suit claims Binance failed to register appropriately. Both Zhao and Binance have refuted these allegations and are seeking to have the lawsuits dismissed.
📰Comparison with Sam Bankman-Fried
In contrast to Zhao’s financial downturn, Sam Bankman-Fried, once considered a rival, faced an even steeper decline. His $16-billion fortune was virtually obliterated in November 2022 after FTX, his exchange, declared a liquidity crisis shortly before filing for bankruptcy. Some speculate that a tweet from Zhao, announcing Binance’s decision to sell its FTX Token (FTT) holdings, might have initiated the crisis. Bankman-Fried is currently on trial, having pleaded not guilty to charges of fraud and conspiracy.
📰Conclusion
The crypto world is witnessing tumultuous times, with industry leaders like Binance and FTX facing significant challenges. The outcomes of these legal battles and market dynamics will shape the future landscape of the cryptocurrency industry.
