Founder and former CEO of the Binance crypto exchange Changpeng Zhao, widely known within the crypto space as CZ, is one of the central figures in the world of cryptocurrency. A “giant” who founded Binance and its native token BNB, one of the top cryptos in terms of market cap.
Unfortunately, recently, his fate took a dramatic turn, making him first step down as the boss of Binance and then making him a prisoner for four months in the USA. Binance has got a new CEO, who took over from CZ, however, the figure of the latter remains influential enough to have a substantial impact on the price of Binance Coin (BNB).
CZ’s Big Impact on Crypto Space in Times of Being Binance CEO
Binance is the largest cryptocurrency exchange in terms of trading volume and one of the most influential trading platforms in the global cryptocurrency landscape as it operates in various jurisdictions, doing its best to comply with the local legislations.
Changpeng Zhao was forced to resign from his CEO position in late November last year after Binance and himself were charged with money laundering and violating the corresponding US laws. CZ took this step upon a long consideration and after Binance agreed to pay an immense fine of $4.3 billion to solve both legal and civil charges brought against CZ by the US the Department of Justice (DOJ) and the Commodity Futures Trading Commission (CFTC).
After CZ announced his resignation on the X platform in November last year, he stated that BNB does not need any CEO to prosper. However, Binance of course needed one, therefore, Richard Teng was picked to replace CZ in that key position. Before that, Teng was part of the Binance team, holding a position of a high-ranking executive.
CZ founded Binance and BNB on the Ethereum blockchain using an ICO in 2017, quickly turning it into the most popular crypto trading venue around the world. Then in 2020, CZ created Binance Smart Chain (BSC) which he later rebranded as BNB Chain. He aimed to make a rival chain to Ethereum, allowing developers to launch tokens, smart contracts and NFTs on BSC. Many took those generous opportunities, since back then Ethereum was famous for its frequent congestions and low transaction throughput. In 2018, the project called Binance Launchpad was created to allow new crypto projects kickstart on it using Initial Exchange Offerings (IEOs).
In October 2022, the year when the cryptocurrency market suffered several major blows, such as the collapse of the LUNA stablecoin UST, the bankruptcy of Celsius crypto lender, etc, CZ launched Binance Square – a social media platform based on Binance, where users now can share their thoughts, publish news, videos, and leave comments. After that, the market faced another big blow – the collapse of the FTX exchange led to bankruptcy by its founder and CEO Sam Bankman-Fried.
Legal Issues Faced by Binance Over Time
The legal troubles faced by CZ and Binance under his leadership have been escalating for quite a while. Financial regulators based in various countries – Europe, Singapore, the US, the UK – kept raising concerns about the operations conducted by Binance. Some of them withdrew their licenses for Binance’s newly released products or for its provision of trading services in general, forcing the exchange to leave those markets.
Those legal concerns were about Binance’s compliance with the local anti-money laundering laws, even though Binance has its own compliance department to follow those laws and collaborate with regulators. In some regions, Binance acted without any necessary licenses and investigations against it were initiated.
In March last year, the CFTC sued Binance and CZ, claiming that they deliberately violated US laws and ran an unregistered futures exchange. Besides, the lawsuit alleged that the Binance exchange was leading improper trading operations and violated anti-money laundering laws, apart from failing to register with the CFTC.
In June, the SEC filed a legal suit against Binance, Binance.US and CZ, saying they violated the US securities laws. Finally, Binance paid the huge fine and CZ gave up his CEO position. Besides, this year in March he was sent to prison where he was meant to do a four-month sentence. This week he was formally released; however, he is still detained in the RRM Long Beach reentry facility.
However, this week Binance and CZ faced another lawsuit accused of harming consumers by their illegal activities, including money laundering to maximize the profits of the exchange.
BNB Price Prospects
Since the end of last week, Binance Coin (BNB) has taken a massive 11% hit, falling from $596 to $530. A number of factors triggered that extensive decline and one of them was certainly the new lawsuit that Binance and CZ are facing right now.
Still, experts believe that Binance and its native coin are quite stable to withstand the current troubles of its former chief executive. Binance is now run by a new respectable CEO, it has branches in many countries around the world and BNB has a wide utility as it is not only chosen as a method for salary payouts to the exchange’s staff but is also accepted as payment by thousands of vendors and companies around the world.
By the start of 2025, BNB is expected to surpass the $600 level and by the end of 2025, analysts believe the coin is likely to overcome $900 and target the $1,000 price mark.
