Changpeng “CZ” Zhao. Founder and CEO of the world’s largest cryptocurrency exchange, Binance. He is an avid Bitcoin enthusiast. Not surprisingly, he has part of his considerable fortune amassed in digital assets.
Who is this interesting person? Let’s have a look at CZ’s CV!
The early life of Changpeng Zhao
Binance’s CEO was born on 5 February 1977 in China’s Jiangsu province. He came from an intellectual family. His parents were teachers and his father was a professor at Hefei University of Science and Technology. At that time, it was one of the leading Chinese universities.
Regarding his emigration to the United States, there are two versions of events. The first says that Zhao’s father was the first to immigrate to the US in 1984. The family joined him in 1989, shortly after the Tiananmen Square massacre.
The second version is equally unoptimistic. As we know, the 1980s were a very turbulent time in communist China. According to the sources, Changpeng Zhao left China with his mother on 6 August 1989 and immigrated to Canada. This was only two months after the Tiananmen Square massacre. CZ and his family camped outside the Canadian embassy for several days to get an expedited visa. They were desperate to leave a country that did not favour opponents of the Chinese Communist Party.
Zhao repeatedly emphasises that he and his parents exchanged ideas while waiting in line at the embassy. These events changed his life and his view of the world forever. At the same time, they opened up unlimited possibilities for Zhao.
After receiving his visa, Changpeng Zhao spent his teenage years in Vancouver. From an early age, he manifested strong mathematical and analytical skills. He was interested in computer programming. Not surprisingly, he decided to study computer science at McGill University in Montreal. After graduation, he did an internship at one of the Tokyo stock exchanges. He later worked for Bloomberg Tradebook in New York for many years, where he developed software for matching trade orders.
Interesting fact 1: Changpeng Zhao first came into contact with the world of computers and programming when his father bought him his first computer. It was a very expensive piece of equipment at the time! We are talking about a 286 DOS model for – a bagatelle – US$ 7,000!
Interesting fact 2: Before CZ’s career took off, he used to take various odd jobs. He even worked at McDonald’s as a chef! Yes, Zhao famously made burgers!
Interesting fact 3: Zhao was 12 years old when he tasted fresh milk for the first time. The event took place after he immigrated to the United States.
CZ’s personal life is little known. The CEO of Binance is not very effusive on the subject. Currently, Changpeng Zhao is not married.
Career Changpeng Zhao
As mentioned, after graduating, he took a job at one of the Tokyo Stock Exchanges. At the time, he worked as a contractor for the Tokyo Stock Exchange. From 2001 to 2005, he worked for Tradebook Futures. However, his work did not give him satisfaction. Eventually, with a group of his friends, he founded an information technology (IT) consulting company. At the same time, he moved to Singapore and launched Fusion Systems.
This is when Zhao’s entrepreneurial nature kicked in. Together with Fusion Systems, he started other ventures. This included Bijie Tech. This was a cloud-based service provider for stock exchanges. Both companies grew strongly.
In 2017, CZ decided to launch its own cryptocurrency exchange, Binance. This coincided with China’s crackdown on digital assets. CZ had two options at the time – close its exchange or move to another country. However, it chose the other option. The company started offering fully remote services. In doing so, Zhao circumvented China’s strict regulations.
The Binance exchange has very quickly become one of the largest cryptocurrency exchanges. It is now known worldwide. Binance reached its peak net worth in 2021 during the cryptocurrency boom. The amount is impressive, as it is talking about…USD 100 billion!
Despite this rapid growth, the stock exchange has had some unpleasant incidents:
- In May 2019, US$40 million worth of BTC was stolen from an exchange.
- The exchange has had a number of problems with regulators. Among other things, the US conducted a detailed investigation in 2021 alleging money laundering on the Exchange.
- It is for these regulatory reasons that Binance has a US subsidiary, Binance U.S. This is a separate entity, dependent on the main exchange.
Zhao, however, is not giving up in his entrepreneurship. He is meticulously cooperating with regulators. He has even changed the company’s structure to comply with regulations.
How much is Changpeng Zhao worth?
The net worth of this persona is estimated at USD 15 billion. The sum fluctuates depending on Binance’s valuation. However, Zhao denies these reports and does not disclose such information publicly.
Interestingly, its value was much higher. During the 2021 bull market, Zhao was valued at US$65 billion!
Binance and the failed FTX exchange – what do they have in common?
Binance has a dominant share of the global cryptocurrency market. There is no denying that it poses a major risk to the entire industry. Its collapse would trigger a worldwide crash. Interestingly, this risk has increased with the collapse of the famous FTX exchange.
The Binance exchange has invested in FTX. In 2021, it monetised its capital in exchange for a payout of US$2.1 billion. Part of this payout was denominated in FTT. In early 2022, the balance sheet of Alameda Research, Sam Bankman-Fried’s company, was backed by FTT. It was a native FTX token. At the time, there was a message on X (formerly known as Twitter) from CZ announcing that it planned to sell its Binance position in FTT. The situation made cryptocurrency markets realise the low liquidity of the FTT token. It supported the insolvent FTX-Alameda ecosystem.
Events flowed exponentially. There was a run on the bank, customers wanted to get their money out of FTX. But…the funds were not there, as they had been sent by FTX to Alameda for trading purposes. The whole situation ended with the collapse of the stock exchange.
Zhao has sprung into action. He announced that Binance would take over the collapsed exchange, sending the entire cryptocurrency industry into a stupor. After a quick due diligence process, he quickly reversed his decision. The magnitude of the damage and loss to FTX was too great. The US$8 billion hole in the budget was unmanageable.
After the collapse of FTX, Zhao and Binance are the leaders in the digital asset market. As CEO of the world’s largest exchange, CZ is vocal about the need for all cryptocurrency exchanges to be transparent and improve their tarnished reputation.
Following the collapse of FTX, CZ is pushing for the introduction of a proof-of-reserve model. Under this mechanism, customer assets can be proven using a public blockchain.
Summary
Changpeng Zhao’s future is strongly linked to the Binance stock exchange. Not surprisingly, investors expect CZ to manage the exchange well. The collapse of FTX was a landmark fall in the cryptocurrency market, but Zhao is the one who brings hope.
So far, we can hardly accuse the CEO of Binance of anything. He handles every obstacle very well. This only underlines how capable he is!