Changpeng Zhao’s Legacy—Binance, Controversies, and the Future
Changpeng Zhao—better known as CZ—is an iconic figure whose influence in the cryptocurrency world is unparalleled. His evolution from a developer to the founder of Binance, the largest crypto exchange globally, encapsulates the journey of the entire industry: meteoric rise, regulatory skirmishes, global shocks, adaptive resilience, and eventual acclaim.
On this page
- From Humble Beginnings to Trailblazing Innovation
- Foundations and the Technical Bedrock
- Bitcoin Revelation—Risk, Reward, and Confidence
- Going All In on Cryptocurrency
- Binance—The Rise of a Crypto Powerhouse (2017–2023)
- Exchange Kickoff
- Regulatory Challenges and Legal Pressure
- Legal Crisis and a Shift in Command
- Guilt, Jail, and a $50 Million Fine
- Lifetime Ban and Corporate Overhaul at Binance
- Binance After CZ—Adjusting to a Regulated World
- Compliance Driving Growth
- Competition and Market Challenges
- CZ’s Enduring Legacy and His New Horizons
- Investing in Blockchain and Artificial Intelligence
- Shaping the Future of Crypto Regulation
- Binance at a Turning Point
This piece explores CZ’s legacy within the blockchain arena, the fallout from his legal issues, and the daunting challenges that Binance—the world’s most influential and liquid exchange—must overcome now that he’s gone.
A lifetime ban from holding leadership positions coupled with his prison sentence marked a decisive moment for the exchange. In the aftermath, Binance is contending with escalating regulatory demands, significant market upheavals, and a major internal overhaul, all while defining its future without CZ steering the ship.
From Humble Beginnings to Trailblazing Innovation
Foundations and the Technical Bedrock
Born in China and later embracing life in Canada, Changpeng Zhao’s early exposure to technology shaped his destiny. He earned a degree in computer science from McGill University in Montreal, paving the way for a career that would soon take him to Tokyo. There, he crafted trading systems for the Tokyo Stock Exchange, mastering high-frequency trading algorithms—a craft that became the bedrock of his later ventures in the crypto space.
In 2005, Zhao’s journey led him to Shanghai, where he founded Fusion Systems, a startup focused on automated trading platforms for brokers. This initiative not only revealed the inefficiencies of traditional finance but also inspired him to develop groundbreaking tech solutions—a vision that ultimately set him on the path to create the world’s largest crypto exchange.
Bitcoin Revelation—Risk, Reward, and Confidence
Going All In on Cryptocurrency
Back in 2013, while enjoying a poker game with BTCC co-founder Bobby Lee, Changpeng Zhao got the tip to invest 10% of his assets in Bitcoin. But CZ went even further—he sold his Shanghai apartment and put his entire fortune into BTC. Despite his family’s doubts, this gutsy move allowed him to beat the market right when crypto was starting its explosive rise.
Making a decision and then executing it is usually much better than not making a decision at all,
Changpeng Zhao.
His resolute faith in blockchain’s potential soon earned him key roles as Chief Technology Officer at Blockchain.info and OKCoin. These positions were instrumental in shaping his vision for a decentralized financial system and laid the groundwork for his next major career venture.
Binance—The Rise of a Crypto Powerhouse (2017–2023)
Exchange Kickoff
In July 2017, Changpeng Zhao made a daring move by raising $15 million via an ICO to launch Binance exchange. In an astonishing eight months, the platform transformed into the world’s largest cryptocurrency exchange.
The story of its success is marked by low trading fees, a broad array of assets, and the strategic deployment of Binance Coin (BNB), which provided users with discounts on fees and a stake in the platform’s governance.
In 2019, Binance launched the Binance Smart Chain (BSC), a formidable alternative to Ethereum that delivers fast, low-cost transactions and is optimized for deploying smart contracts and decentralized applications (dApps).
Regulatory Challenges and Legal Pressure
Even as Binance experienced explosive growth, its very “flexible” stance on compliance caught the eye of regulators. In 2021, the U.S. Department of Justice (DOJ) opened an investigation into the exchange, probing for possible breaches of anti-money laundering and sanctions laws.
We have an open democratic market, and the market will self-correct,
Changpeng Zhao.
CZ’s approach—focusing on aggressive expansion rather than strict KYC (Know Your Customer) and AML (Anti-Money Laundering) compliance—eventually hit a critical juncture. In 2023, Binance struck an unprecedented global settlement with U.S. regulators worth $4.3 billion.
This landmark settlement has become a defining moment in cryptocurrency regulation, altering the global governmental stance on the crypto industry.
Legal Crisis and a Shift in Command
Guilt, Jail, and a $50 Million Fine
In November 2023, Changpeng Zhao pleaded guilty to federal charges, resigned as CEO of Binance, and was sentenced to four months in prison along with a hefty $50 million fine.
Starting in April 2024, his imprisonment marked a watershed moment in the industry: for the first time, a leading figure from a major crypto enterprise was confined behind bars. This unprecedented development heralded a radical transformation in regulatory approaches to the crypto arena—a realm that had, until now, celebrated rapid expansion and embraced high-risk ventures without facing dire consequences.
Lifetime Ban and Corporate Overhaul at Binance
In September 2024, regulators permanently prohibited CZ from serving in any executive capacity at Binance, though he maintained control of up to 90% of the company. With Richard Teng taking over as CEO, Binance reformed its governance structure by expanding the board to seven members, including DOJ-appointed observers to reinforce oversight and transparency.
This sweeping restructuring was designed to forestall future regulatory pitfalls, yet it has also sparked apprehension about diminishing the operational nimbleness that once defined Binance.
Binance After CZ—Adjusting to a Regulated World
Compliance Driving Growth
Since the global settlement in 2023, Binance has elevated regulatory compliance to its highest priority. The exchange has reinforced its KYC/AML protocols and has delisted privacy-centric cryptocurrencies like Monero. While these measures have strengthened the confidence of institutional investors, they have also caused friction with parts of the crypto community that prioritize confidentiality and minimal external intervention.
Co-founder Yi He summed up the sentiment:
It’s a complex challenge, but essential for long-term trust in the ecosystem.
Competition and Market Challenges
With 200 million users under its belt, Binance is nonetheless facing heightened competition from Coinbase, Kraken, and various DEX platforms.
Compounding the challenge is Ethereum’s decline: since 2021, ETH spot trading volumes have shrunk by 84%, a drop that significantly affects Binance due to its heavy reliance on the synergy between BNB Chain and Ethereum.
CZ’s Enduring Legacy and His New Horizons
Investing in Blockchain and Artificial Intelligence
Following his release in September 2024, Changpeng Zhao embarked on a new journey, turning his focus to startups in the blockchain and AI sectors. He’s been channeling his substantial capital into decentralized AI ventures. According to Forbes, by mid-February 2025, CZ ranked 25th among the world’s billionaires, with his net worth topping $64 billion.
Although he no longer manages Binance on a day-to-day basis, his influence remains significant as a major shareholder, shaping the company through strategic board roles and initiatives.
Shaping the Future of Crypto Regulation
CZ’s career is a testament to the persistent struggle between innovation and regulation. His relentless pursuit of greater user freedom has repeatedly put him at odds with regulatory authorities, sparking widespread debate on how to balance the promise of decentralization with the need for oversight.
In the insightful words of Ethereum’s Anthony D’Onofrio:
Leadership reforms are inevitable as blockchains evolve from experiments to institutional assets.
Discover CZ’s forthcoming vision in a first public interview following his release from prison!
Binance at a Turning Point
Binance’s post-CZ era reflects a broader change sweeping across the crypto world, evolving from a wild, unregulated playground to a space that's increasingly under institutional control.
Although Changpeng Zhao’s visionary approach sparked phenomenal growth, his reluctance to embrace regulation has forced a deep corporate realignment, potentially curbing the innovative drive that once positioned Binance at the pinnacle of the market.
To keep its edge, Binance needs to balance regulatory requirements with the freedom to innovate technologically. This challenge is intensified by a drop in Ethereum’s market share and the rising clout of Bitcoin, which is garnering greater respect as U.S. crypto policy shifts.
While CZ forges ahead into the new possibilities offered by AI and blockchain, his legacy is a complex one—a blend of inspiration and a cautionary reminder.
Binance and the wider crypto ecosystem continue to glean insights from his past, which vividly demonstrates both the dynamic power and the significant risks of accelerated change in the world of digital assets.
Binance will be fine,
Changpeng Zhao confidently states.
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