Binance Founder CZ’s Fortunes Plummet By $12 Billion Amidst Downturn in Crypto Trading
October 27 2023 - 6:00PM
NEWSBTC
Changpeng Zhao, widely known as CZ and the founder of Binance, one
of the largest cryptocurrency exchanges, has suffered a significant
blow to his fortune. According to a recent Bloomberg report, CZ’s
wealth plummeted by $12 billion due to the ongoing slump in
crypto-trading activities. Per the report, this decline was
primarily attributed to a sharp drop in trading volumes at Binance
throughout the year. CZ’s Financial Losses The Bloomberg
Billionaires Index revised its revenue estimates for Binance,
slashing it by 38% after data revealed a decline in trading volumes
at the exchange. As a result, CZ’s net worth now stands at $17.2
billion, marking a significant reduction from his previous
valuation. Related Reading: Shiba Inu Team Member Clarifies SHIB
Burn As Shibarium Grows According to Bloomberg, CZ’s involvement in
recent events that led to the bankruptcy filing of FTX further
impacted his financial situation. In November, CZ announced the
liquidation of a token linked to FTX (FTT) after reports emerged
that Alameda Research, the hedge fund owned by Sam Bankman-Fried,
the founder of FTX, held a large position in it. The
announcement triggered a rush among FTX customers to withdraw
funds, overwhelming the exchange’s infrastructure. As a
consequence, FTX declared bankruptcy within a week, erasing
Bankman-Fried’s fortune, which had peaked at $26 billion in March
the previous year. To estimate Binance’s revenue, the Bloomberg
Billionaires Index relies on spot and derivatives trading data from
crypto-tracking services Coingecko and Coinpaprika. Binance
had witnessed a significant gain in market share earlier this year,
reaching 62% of total on-exchange crypto trades during the first
quarter. However, after a promotional zero-fee period for popular
trading pairs ended, Binance’s market share slid to 51% by the end
of the third quarter, as reported by research firm CCData. Binance
Value Plunges As Lawsuits And Allegations Take A Toll Binance has
also faced increasing regulatory scrutiny, isolating itself from
the traditional financial system. The Securities and Exchange
Commission (SEC) filed a lawsuit against Binance in June, accusing
the exchange of violating regulations. Earlier this year, the
Commodity Futures Trading Commission (CFTC) also took legal action
against Binance for non-compliance with rules that allowed US users
to access the platform. Allegations against Binance include
inadequate money-laundering controls, inflated trading volumes, and
mishandling of client assets. Binance has strongly disputed these
claims and is currently contesting them in court. Related
Reading: Bitcoin Braces For $50 Billion Influx Following ETF
Launch, Bitwise CEO Says In June, Bloomberg’s wealth index reduced
the value of Binance’s US exchange to zero after it announced the
discontinuation of dollar transactions, resulting in a significant
decline in trading volumes. Binance.US had previously been
valued at $4.7 billion during a funding round in March 2022, while
CZ’s net worth peaked at $96 billion in January. The challenges
faced by Binance are not unique, as regulatory uncertainties and
rising interest rates have made alternative investments more
appealing. Coinbase Global, another leading cryptocurrency
exchange, experienced a 52% decline in spot trading volume in the
third quarter compared to the previous year, according to
Bloomberg. Despite the personal wealth challenges CZ faces,
Binance Coin (BNB) has capitalized on the overall market recovery,
showcasing substantial gains across various time frames. Currently,
the token is trading at $225.2, maintaining its upward trend with a
2.2% increase over the past 24 hours. Furthermore, BNB has
demonstrated significant gains of 5.8%, 9.6%, and 6.1% over the
seven, fourteen, and thirty-day time frames, respectively. These
positive trends highlight the token’s strong performance in recent
weeks. Featured image from Binance, chart from
TradingView.com
SHIBA INU (COIN:SHIBUSD)
Historical Stock Chart
From Jun 2024 to Jul 2024
SHIBA INU (COIN:SHIBUSD)
Historical Stock Chart
From Jul 2023 to Jul 2024