Regulatory challenges and declining trading volumes have dealt a significant blow to the Binance exchange, leading to a dramatic decline in the net worth of its co-founder and CEO Changpeng Zhao (CZ). On October 27, Bloomberg revealed that Binance’s trading volume for the year experienced a significant decline. It also reported that the Bloomberg Billionaires Index cut the company’s revenue forecast by a staggering 38%. This caused the wealth of CZ, CEO of the cryptocurrency exchange Binance, to decrease by a significant amount of $11.9 billion and remain at $17.2 billion. Here are the details…
Binance CEO’s fortune dropped
cryptokoin.com As we reported, Binance, the world’s largest cryptocurrency exchange by daily trading volume, has experienced difficulties with regulatory developments and market decline. This difficulty seems to be reflected in the CEO’s wealth. Because Changpeng Zhao lost $11.9 billion in assets. This decline marks an 80% decline in CZ’s wealth since its peak in January 2022, when he was the 11th richest person globally, with a net worth approaching $97 billion. As of October 26, 2023, CZ ranks 95th on the Bloomberg Billionaires Index with a net worth of $17.3 billion.
While CZ’s declining net worth is a clear indication of the challenges facing Binance, the exchange has found itself in a legal battle with the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). In June, the SEC filed a lawsuit against CZ, Binance and its US-based arm Binance.US, accusing them of engaging in illegal transactions, selling unregistered securities and mismanaging customer assets. CZ was specifically named as the “controlling person” in the lawsuit.
The stock market also suffered a decline in its dominance
The CFTC followed suit in March, alleging that Binance had failed to properly register with the regulatory authority. Both CZ and Binance have strongly denied the allegations and are actively working to have the lawsuits dismissed. In addition to these regulatory disputes, Binance’s market share in the spot trading industry has also been experiencing a steady decline. As of September, it had fallen in market share for seven consecutive months, falling to 34.3%. This represents a significant loss of market dominance since January 2022, when Binance had over 55% spot market share.
Binance’s US-based arm, Binance.US, has also seen trading volumes decline in recent months, contributing to the exchange’s growing difficulties. However, the decline in CZ’s net worth pales in comparison to the dramatic decline experienced by his one-time rival Sam Bankman-Fried. In November 2022, FTX, the cryptocurrency exchange founded by Bankman-Fried, revealed a liquidity crisis just days before filing for bankruptcy. Thus effectively wiping out Bankman-Fried’s $16 billion fortune.
Did CZ take part in triggering the crisis?
Interestingly, some experts believe that CZ played a role in triggering this crisis. In a tweet, CZ announced Binance’s intention to sell FTX Token (FTT) assets, sparking a wave of withdrawals from FTX. Although he initially expressed interest in buying the struggling exchange, CZ abruptly withdrew his offer less than 48 hours later. Bankman-Fried is currently facing serious financial difficulties and took the witness stand at the criminal trial on October 26. He had previously pleaded not guilty to two counts of fraud and five counts of conspiracy, marking a turbulent period in his career.
To be informed about the latest developments, follow us Twitter’in, Facebookin and InstagramFollow on . Telegram And YouTube Join our channel.