Changpeng Zhao: How did I make 130 billion?

Hurun Research Institute released the "2024 Hurun Global Rich List" on March 25 (the deadline for wealth calculation is January 15, 2024). The 52-year-old Elon Musk regained the title of the richest man with a fortune of 1.67 trillion yuan (231 billion US dollars).

Additionally, Hurun Research Institute wrote that cryptocurrencies seem to have moved on since the FTX crash. While Binance was fined more than $4 billion by the U.S. Department of Justice for money laundering , its former CEO Changpeng Zhao’s wealth grew to 130 billion yuan ($18 billion), ranking 100th on the list, as interest in cryptocurrencies surged.

The man who sold his house to enter the cryptocurrency world

Changpeng Zhao (also known as CZ) was born in Jiangsu in 1977. He immigrated to Canada with his parents when he was 12 years old. He majored in computer science in college and started his programming career.

After graduating from university, CZ worked as a technical consultant for several companies, mainly designing and developing systems for matching trading orders. As a programmer, he developed a system for matching trading orders for the Tokyo Stock Exchange. He also served as technical director of Bloomberg in New York, developing futures trading software for it.

He was promoted three times in less than two years. But he was still not satisfied with the status quo, so he resigned in 2005 and came to Shanghai, where he founded his first company, Fuxun Information Technology Co., Ltd., which specialized in developing the fastest high-frequency trading system for securities companies.

It was not until 2013 that Bobby Lee heard about BTC through his good friend Bobby Lee, the former co-founder and CEO of BTCC and BTC China, and began to get in touch with blockchain. Bobby Lee once said to CZ:

“If you invest 10% of your net worth in BTC, as long as it rises 10 times, your wealth will double, and if there is a loss, you will only lose 10% of your assets.”

This sentence made CZ very interested in blockchain. CZ then started to get involved in blockchain projects and joined Blockchain.info as the third founding employee. During his 8-month work there, he frequently came into contact with BTC evangelists Roger Ver and Ben Reeves, and his confidence was further strengthened under the influence of some industry giants.

It was not until June 2014 that he was invited by He Yi (known as the No. 1 lady in the cryptocurrency circle and now the co-founder and CMO of Binance) to become the CTO of OKcoin.

At this time, CZ sold his house in Shanghai and invested all his funds in BTC. He had no other assets except his mobile phone. Therefore, he is also regarded by Crypto believers as the first person to hold 99% of his assets in Crypto.

In less than a year, Shanghai housing prices doubled, but BTC plummeted. Faced with huge financial losses, he did not choose to give up. During his time at OKcoin, CZ mastered the logic of Crypto exchanges and the operation of the entire industry.

Later, due to the differences in culture and values ​​between the two sides, Zhao Changpeng chose to resign. He had a conflict with the founder of OKcoin, Xu Mingxing, and left OKcoin.

Founding Binance

Mastering the code of wealth After leaving OK Coin, Zhao Changpeng saw the booming market of cultural product trading industry and founded Bijie Technology, which is responsible for providing trading systems for collectibles such as coins, stamps, and phone cards. Although the company was doing well, he still wanted to have his own exchange, so in June 2017, he chose to establish Binance and launched his own blockchain currency - Binance Coin, and embarked on the road to billions of wealth.

Compared with other Crypto, Binance mainly wants to aggregate high-quality blockchain assets around the world to provide users with more convenient and secure services.

Binance provides ordinary people with a trading platform with a very low investment threshold. In less than 10 days, the first issuance brought Binance $15 million in financing. In less than a year, it attracted the attention of PanCity Capital, Sequoia Capital and IDG Capital, all of which wanted to provide financing for it.

As the price of BTC soared from September to December 2017, with the price rising from $3,000 to $20,000, an astonishing increase, people began to rush to get into Crypto exchanges.

During the bull market, Crypto trading volume broke the previous record. At its peak, the daily trading volume of all exchanges and Crypto around the world reached $60 billion, and Binance accounted for one-sixth of it, reaching $10 billion.

And don’t forget that in the cryptocurrency world, wherever there is Binance, there must be He Yi. This chief customer service representative has always been active on the front line of work. Most of the credit for Binance’s current market share and ecological environment should be attributed to this “No. 1 lady in the cryptocurrency world”.

Rapid development

In 2017, Zhao Changpeng founded Binance. At that time, He Yi's two-year non-competition period at OKcoin ended, so Zhao Changpeng invited He Yi to join Binance as co-founder and chief marketing officer (CMO).

He Yi, who returned to the cryptocurrency circle, lived up to her reputation as "the best marketer in the crypto circle". With her skillful series of marketing activities, in less than half a year, she made Binance the number one in global cryptocurrency trading volume, with a trading volume of more than 3 billion US dollars.

From 2017 to the present, He Yi and Zhao Changpeng have worked closely together to conquer the global crypto asset market and Web3 field and gain great success.

He Yi is the second largest shareholder of Binance. Counting the company's shares and profits, plus the Binance coin BNB she holds, her assets must be more than 1.5 billion US dollars. No wonder when asked about her annual salary at Binance, she said proudly: "That's just pocket money, I don't pay much attention to it."

Two years of planning On June 24, 2017, Binance was officially established and began to raise Binance platform coin BNB. At that time, Binance raised US$15 million in crypto assets in just about a week.

Later, on July 14, 2017, Binance Web was officially launched, and BNB was listed for trading. The issue price of BNB was US$0.15 at the time, and the lowest price after the launch was US$0.23. However, Binance actually raised only more than 10 million US dollars, less than 100 million RMB, so Binance itself does not hold many coins. Affected by "94", BNB fell, and Binance subsidized these users' liquidation refunds of nearly 20 million.

For Binance at the time, this was a huge sum of money. It also included the liquidation of BNB users in China. At that time, many cases were liquidated at the issue price, but Binance liquidated at the market price of about 4 yuan. At that time, there was a feeling: "Binance only raised this little money in total, and used most of its worth to subsidize users."

However, the number of Binance user registrations experienced explosive growth afterwards, increasing from 1 million registered users to 7 million in just three months from December 2017 to February 2018, making Binance the world's largest digital asset trading platform. Due to the rapid development of Binance, CZ also appeared on the cover of Forbes magazine at the time, ranking third on the rich list with a net worth of US$2 billion.

Looking back

CZ mentioned in his personal letter on Binance’s sixth anniversary:

Today, Binance is a platform that provides financial services to more than 140 million users worldwide, and it may welcome billions of new users in the future. And all of this was just a dream at first.

Six years ago, with your support, Binance raised $15 million worth of crypto assets and started building a currency-to-currency platform. Two weeks later (six years ago today), Binance was born, with 5 tokens listed and 2 service languages. At that time, our customer service team was borrowed from my friend's company, and we didn't have our own marketing team.

Today, Binance has listed more than 600 tokens, provides more than 40 service languages, and has a customer service team of thousands of people. Now, BNB Chain provides support from decentralized trading platforms to various storage applications.

Two months after Binance was founded, we encountered a severe test. On September 4, 2017, mainland China issued a ban on crypto asset trading platforms and ICOs. Chinese ICO projects had to return funds to investors.

As soon as the ban was announced, the prices of many tokens plummeted. Several projects listed on Binance even fell below their issue prices, and the project teams did not have enough funds to repay investors.

Our team did the math and called me to ask if we wanted to use Binance’s own funds to compensate these investors. The total amount was $6 million, which was definitely not a small amount at the time, but we agreed to do it. The call lasted only 5 minutes, and I was still on a moving train. A few minutes later, we released the announcement.

At that time, $6 million accounted for more than 40% of our total funds, which was the largest expenditure in Binance's history. At that time, we were only a two-month-old startup, not yet profitable, and were still burning money on recruitment, purchasing servers, etc.

But my only thought at the time was: protecting users.

Sure enough, as long as you do the right thing, the world will give you positive feedback. Our decision received strong positive feedback from the global crypto asset community, and many new users flocked to us. One month later, our user base reached 120,000 and began to make a profit.

And we have remained profitable ever since.

Meanwhile, we kept building and growing our user base. On December 18, 2017, I received a lot of congratulatory text messages from friends. It took me a few minutes to figure it out: On that day, Binance became the world’s largest cryptocurrency exchange by volume, a position we still maintain today.

However, Binance’s growth was not smooth sailing. Just a few days later, a potential venture capital firm (Sequoia) filed a lawsuit against us. The lawsuit lasted for several years, and we eventually won a comprehensive victory.

Many Internet startups with large capital flows may not survive a long lawsuit like this, but fortunately, thanks to crypto assets, we have established a sustainable business model. A few years after the lawsuit ended, at our invitation, this potential investment institution also became a limited partner in Binance Labs' second fund. I am happy to say that we still maintain a good relationship with them and most of the problems can be resolved.

But this lawsuit also had a side effect on Binance, making it impossible for Binance to accept investment from VCs. As a startup, our risks have increased, but it may help us in the long run. We have been able to maintain flexible and independent operations. ”

CZ Today

Recently, Zhao Changpeng, who is still in the United States due to a lawsuit, has not stopped moving forward. After founding the world's largest cryptocurrency exchange, today he officially announced his next entrepreneurial project "Giggle Academy".

The official website shows that Zhao Changpeng has regarded this project as a new chapter in his life, aiming to build a high-quality education platform that is completely free and open to everyone.

Looking around the world, there are many excellent educational projects focusing on adult education, elementary school to university, and even early childhood education. These Internet educations play an important role in the universal basic education of mankind, eliminating the negative impact of geographical location, race, religion, belief, economy, culture and other factors in various regions of the world. As long as you have a mobile phone and can connect to the Internet, the ocean of knowledge will be at your fingertips.

At present, the quality of some primary education is actually uneven. Children in many areas still face problems such as lack of educational resources and low teaching quality. Some children can get excellent resources at birth, while some children are already far behind at the starting line. This is exactly what Giggle Academy is trying to solve.

Final Thoughts

In the vast ocean of cryptocurrency, Zhao Changpeng (CZ) went from selling his house to leading Binance to the pinnacle, and his wealth also soared to an eye-catching 130 billion RMB.

In this article, we tell the legendary story of CZ from a teenager in Jiangsu to a giant in the cryptocurrency world. His journey is full of wisdom and courage. From the programming workbench in Tokyo to the technology field of Bloomberg in New York, and then to the entrepreneurial road in Shanghai, every step reflects his exploration of the unknown and his desire for the future.

It can be said that the rise of Binance is like an epic, showing the wisdom and resilience of CZ and He Yi, who together wrote a new chapter in the history of cryptocurrency.

In the future, as digital currency continues to evolve, we have reason to believe that these digital pioneers will continue to lead us into a new financial era in the wave of change.