Changpeng Zhao, also known as CZ, the former CEO of Binance, the world’s largest crypto exchange, has become the latest high-profile crypto executive to resign and plead guilty to money laundering violations in the United States, resulting in substantial fines.
Changpeng ‘CZ’ Zhao, born in China in 1977, saw his journey from his family’s relocation to Canada in the 1980s to earning a computer science degree from McGill University, as documented in the Bloomberg Billionaires Index. In 2017, he founded Binance in Shanghai, playing a pivotal role in transforming the company into the world’s largest cryptocurrency exchange.
With 8.7 million social media followers, CZ became a well-known figure in the crypto world, reaching a peak net worth of approximately $65 billion in 2022, according to Forbes. However, as Binance’s influence grew, so did regulatory scrutiny, with numerous crypto firms worldwide facing criminal investigations.
The United States accused CZ and Binance of multiple violations, including knowingly facilitating transactions involving militant groups such as the Islamic State, as well as conducting business in prohibited jurisdictions like North Korea and Iran. In a surprising turn of events, CZ and Binance pleaded guilty to these charges, agreeing to total penalties of nearly $4.4 billion, with CZ personally paying $50 million, according to court documents.
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CZ has resigned as CEO of Binance and, while retaining his shares in the company, has been barred from any involvement in its operations. His sentencing is expected in the near future, and Forbes listed his net worth at $10.2 billion as of Wednesday.
Sam Bankman-Fried, notable as one of the most famous personalities in the crypto industry, gained notoriety while CZ held the title of the richest and most powerful figure. Born to Stanford University professors, Bankman-Fried graduated from MIT with a degree in physics. In 2019, he founded FTX, which quickly rose to become the world’s second-largest cryptocurrency exchange. Along the way, he cultivated an image as the unofficial ambassador for the crypto industry, making high-profile appearances in the media and testifying before the US Congress.
At one point in 2022, Bankman-Fried’s net worth reached an impressive $24 billion, according to Forbes. However, his success was marred by controversy, as his team was found to have used customers’ funds for various purposes, including luxury real estate acquisitions and covering risky moves by the affiliate Alameda Research.
The situation reached a tipping point in November 2022 when these actions were exposed in the media. CZ Zhao, Binance’s former CEO, swiftly announced that Binance would divest all FTX tokens it held, triggering a dramatic collapse of FTX and Bankman-Fried’s empire. He was subsequently arrested in the Bahamas in January and recently found guilty of what US prosecutors described as “one of the biggest financial frauds in recent memory.”
