In 2023, Changpeng Zhao (CZ), the founder and former CEO of Binance, experienced a remarkable wealth increase despite significant legal challenges, according to Bloomberg.CZ‘s net worth soared by about $25 billion, reaching an estimated $36.2 billion. This surge was primarily driven by the recovery in crypto markets and increased trading volumes on Binance, the world’s largest crypto exchange.
CZ, however, faced legal troubles as he pled guilty to anti-money laundering and U.S. sanctions violations as part of a settlement agreement with U.S. authorities. This plea was part of a larger $4.3 billion settlement, resolving an investigation into Binance‘s compliance with U.S. laws. As a result of the settlement, Zhao agreed to pay a $150 million fine and stepped down as Binance‘s CEO, though he still maintains an ownership stake in the exchange. The U.S. Commodity Futures Trading Commission (CFTC) and the U.S. Department of Justice (DoJ) were involved in the enforcement actions against Zhao and Binance.
Interestingly, the increase in Zhao’s wealth is more than five times the amount of the fines paid to U.S. authorities. Despite this financial growth, Zhao’s wealth is still lower than its peak of nearly $97 billion at the beginning of 2022. The wealth growth of other crypto entrepreneurs, such as Brian Armstrong of Coinbase and the Winklevoss twins, also increased significantly in 2023, reflecting a favorable trend for leaders in the crypto industry.
Compared to CZ, the wealth of Coinbase founder Brian Armstrong is modest at around $7 billion. This puts him in 351st place in the Bloomberg Billionaire Index.
Zhao is scheduled to be sentenced in February 2024 and could face up to 18 months in prison, though the Justice Department could seek a more severe jail term. A federal judge has ordered Zhao to remain in the U.S. until his sentencing, citing his vast fortune and residency in the United Arab Emirates as factors that make him a flight risk. Zhao’s situation is a notable example of the complexities facing crypto industry leaders who balance immense wealth with the challenges of navigating a rapidly evolving regulatory landscape.
