Binance and CZ’s fortunes are set to grow

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South Africa Headlines News

Jail or no jail.

It’s “better to ask for forgiveness than permission” when it comes to complying with the law, the billionaire founder of the Binance cryptocurrency exchange once told his team, according to the US government.

“The DOJ should have charged dozens of people connected to Binance and should have not only prosecuted them and punished them but barred them from the financial industry forever,” said Dennis Kelleher, president and CEO of the advocacy group Better Markets. “If you’re not going to punish the others, he deserves the most-severe sanction possible.”

While its dominance has slipped a bit, Binance has maintained its market-share leadership in combined spot and derivatives crypto markets. The company said it added more than 40 million new users in 2023, up 30% from the prior year. Customers’ holdings on the exchange have swollen to more than $100 billion. The company likely made $9.8 billion in annualized revenue in the 12 months through March, according to Bloomberg estimates.

“Binance was the biggest exchange and operated well throughout the failures of FTX, 3AC, Terraform Labs, and more,” said Austin Campbell, an adjunct professor at Columbia Business School and a consultant for blockchain firms. “The US government’s action was seen as a big overhang, and since they will survive it, it gives people confidence in them.”

While Richard Teng, who previously was the head regulator at Abu Dhabi Global Market, is the post-Zhao chief executive and public face of Binance, Zhao’s partner remains an important force in the company. “CZ was just stepping down, he’s not going down to hell,” Yi He said with a chuckle during the discussion on X. In spirit, he’s “still with us, don’t worry about it,” she said, while giving a glimpse at some of what Zhao was up to while awaiting sentencing: Hitting the ski slopes.

Now it’s time for Zhao’s friends to take care of his creation, a massive company which has thousands of workers scattered around the world but still no physical headquarters. A US monitor — likely a big law firm or consultant — will be assigned to keep an eye on Binance’s compliance with the US plea agreement for five years to make sure it’s taking appropriate steps to abide by anti-money laundering and sanctions laws.

 

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