“To build a successful company, one must have a firm belief and a clear worldview; you need to recognize the potential of certain trends earlier than others.”
Compiled by: Deep Tide TechFlow
Guest: Changpeng Zhao, Founder of Binance
Host: Anthony Pompliano
Podcast Source: Anthony Pompliano
Original Title: The King of Crypto: CZ’s Rapid Rise
Release Date: July 2, 2025
Key Points Summary
CZ is the founder of Binance and one of the most successful entrepreneurs of our time. In this interview, we delve into his life journey—from his first purchase of Bitcoin in 2013 to how he navigated the ups and downs of the crypto market, as well as his outlook for the future. The discussion covers his childhood experiences, career, the story of founding Binance, and the various challenges he faced in the crypto industry.
Highlights of Insights
I missed the internet wave, but when Bitcoin appeared in 2013, I was already 35 years old. I realized I couldn't miss this opportunity again, so I quit my job, sold my house, and fully committed to the crypto space.
Traditional financial markets will also enter the cryptocurrency space on a larger scale.
Bitcoin, blockchain, and artificial intelligence are the three core technologies I have encountered in my adult life.
What truly limits me is not money, but other factors such as talent, team, health, and time, which are the limited resources. So I am now more focused on these aspects.
I have always felt that I am not much different from others, so I have never felt superior or inferior. I hope I won't be overly arrogant, but I also won't be overly pessimistic.
I believe the U.S. has the potential to become the global center for cryptocurrency, and we hope to contribute to that. We are like in a simulated environment; when facing challenges, we just need to do our best and keep moving forward.
Starting an exchange is not a new idea; almost everyone I have encountered in the crypto industry has considered starting an exchange. I have always believed that the idea itself is not the most important; execution is key.
To build a successful company, one must have a firm belief and a clear worldview; you need to recognize the potential of certain trends earlier than others.
Binance's profit in its first year was about one billion dollars, possibly making it the first company to achieve a billion dollars in profit from a startup.
We hold our profits in cryptocurrency and have not converted them into fiat currency because we believe in the long-term value of cryptocurrency.
When checking my personal wallet, I have never cashed out these assets; it feels more like a virtual number rather than actual wealth. This mindset helps me focus on long-term development rather than being troubled by short-term fluctuations.
Although I could choose to live in a country without an extradition treaty and lead a relatively stable life, that is not the lifestyle I want. I do not want to live a life of evasion or hiding.
I have a certain level of trust in the U.S. judicial system. Although the crypto industry faces political pressure, I believe the U.S. judicial system is still relatively fair.
The Role of Bitcoin and Cryptocurrency in the World
Anthony:
CZ, as one of the most influential entrepreneurs in the world, you have not only achieved personal success but have also led Binance to become a leading company in the crypto industry. However, I think many people outside the crypto industry do not understand how large companies like Binance have grown and may not fully grasp the achievements you have made.
For those who reach the pinnacle in their chosen fields, their worldview is often very interesting. Considering that you built your company in the crypto industry, talk about Bitcoin and cryptocurrency. What do you think its role in the world is? How will its importance continue to grow in the future?
CZ:
Of course. I think you mentioned a key point. Over the years, I have learned that to build a successful company, one must have a firm belief and a clear worldview; you need to recognize the potential of certain trends earlier than others.
I feel fortunate to have been exposed to Bitcoin early on. This is our third podcast recording. When I first encountered Bitcoin in 2013 and 2014, I thought, “This technology is amazing; it will be a bigger revolution than the internet.” I missed the internet wave, but when Bitcoin appeared in 2013, I was already 35 years old. I realized I couldn't miss this opportunity again, so I quit my job, sold my house, and fully committed to the crypto space.
I believe this firm belief is very important.Blockchain technology is not only applicable to the currency field but can also be used in any future scenario that requires verification. Traditional databases can store data but cannot easily verify it, while blockchain technology provides a more reliable way to verify. The application potential of this technology in the financial sector is enormous, and we are still in the early stages of its application in the financial world. For me, this is a significant technological opportunity that cannot be missed. The next similar technological revolution may occur in 10 to 15 years, and what we see now in artificial intelligence is also an important direction. I believe Bitcoin, blockchain, and artificial intelligence are the three core technologies I have encountered in my adult life. This worldview is crucial for building platforms and driving industry development.
Anthony:
You mentioned worldview, which is clearly closely related to personal experience. You have worked in various types of companies and have been exposed to many different living environments, and these experiences seem to have helped you cultivate empathy and intuition. Intuition is like your human algorithm; the more you are exposed to, the better you can recognize potential. When you first encountered Bitcoin, what made you think it would be so massive? Was it the technology itself, the price trends, or some market factors? What convinced you it would change the world?
CZ:
I am fortunate to have lived in different countries. This has given me a deeper understanding of globalization. I was born in China and later moved to Canada, where I completed my studies. After that, I worked in Tokyo, New York, and Shanghai. This global experience made me realize that currency should not be limited by national borders. When moving between different countries, I had to exchange currencies, and during my journey from Japan to New York, I lost a lot of money due to exchange rate losses. This made me aware of the limitations of the currency system.
Additionally, I have a technical background. As early as 1998, I used PGP encryption technology, which allowed me to understand Bitcoin's encryption algorithms. I also worked on Wall Street, accumulating fintech experience in places like Bloomberg and the Tokyo Stock Exchange system. This background enabled me to understand Bitcoin's potential earlier than others. At the same time, I observed that the Bitcoin community in 2013 was full of innovation and collaboration, which further strengthened my belief.
I believe the combination of these experiences allowed me to recognize Bitcoin's value earlier than others and enabled me to stay firmly in this industry. I think all of this contributes to people's perspectives or understanding of the world; having a global perspective rather than a limited national view is very important.
CZ's Outlook on the Future and the Crypto Industry
Anthony:
You are one of the most successful entrepreneurs of our generation. People are curious about your wealth status; can you talk about it openly? Everyone wants to know how successful you really are, and wealth seems to be a way to measure success.
CZ:
I know I have enough money to live comfortably and enough resources to do what I want to do. For me, money is a tool that allows me to do the things I think are important. For example, if I want to start a business that can help others and create a positive impact, I have enough resources to achieve that. But what truly limits me is not money, but other factors such as talent, team, health, and time, which are the limited resources. So I am now more focused on these aspects rather than money itself.
Anthony:
Bitcoin is clearly your first love in this industry, and you have successfully built a leading global exchange. What do you think the current direction of the crypto industry is? Especially as more and more countries begin to support cryptocurrencies, and hundreds of millions of people have started to register and use these assets.
CZ:
I am very optimistic about this market. Some of the most powerful governments in the world are promoting the development of cryptocurrencies. For example, we see publicly listed companies with Bitcoin reserves, which is a remarkable development. I believe we will see more institutional adoption in the future, such as ETFs, public reserves, Bitcoin reserves, etc. Additionally, companies have launched BNB reserves and Ethereum reserves, which are all positive trends.
I believe traditional financial markets will also enter the cryptocurrency space on a larger scale. At the same time, in terms of innovation, we will see more integration between artificial intelligence and blockchain. This intersection is rapidly expanding. For example, blockchain technology has been adopted by many governments and is being applied in areas such as decentralized identity, land registration, medical welfare distribution, and taxation. This indicates that blockchain is transitioning from a single financial tool to multidimensional solutions, and these developments are very exciting.
If you had asked me nine months ago, I would have never predicted we would be in the current environment.
This also reflects the importance of changes in government structures. Elections can quickly bring new ideas and innovative policies. I believe the U.S. has the potential to become the global center for cryptocurrency, and we hope to contribute to that. Although currently facing some restrictions, we look forward to making more contributions in the future.
Anthony:
It's a bit crazy, right? You are the largest crypto exchange in the world, yet you are not in the U.S.
CZ:
We hope to enter the U.S. market. Currently, the fees for cryptocurrency exchanges in the U.S. are about 10 to 20 times higher than in other parts of the world. This is somewhat abnormal because in the U.S., prices for other goods are usually lower, and delivery speeds are faster. For example, when I use Amazon in the U.S., the prices are cheaper, and the shipping is faster. But in the cryptocurrency space, U.S. consumers pay higher fees and have fewer choices. We hope to change this situation, but we are currently limited by some regulations, and we need to address this step by step.
I think we are like in a simulated environment; when facing challenges, we just need to do our best and keep moving forward. I also want to thank you for your support over the years. Although we haven't had many opportunities to work together, I have always respected your contributions to the industry; you are a rational voice in the U.S. crypto industry. I am very grateful for everything you have done and hope for more opportunities for collaboration in the future.
CZ's Childhood Life
Anthony:
Although we have known each other for a while, I find that most people focus on your professional achievements and know very little about your childhood. When I talk to people and learn more, I realize that your upbringing in China was quite tough. Can you share what your childhood life was like?
CZ:
I was born in a remote rural area of China and later moved to a smaller village. Before I can remember, my family had no running water and no electricity. In elementary school, I often studied under an oil lamp, which had a glass cover. A few years later, we installed a water pump to draw water. It took us even longer to get electricity. Eventually, we moved to a small city in China and then immigrated to Canada. All of this happened before I turned 12, so my life underwent tremendous changes.
Even when we got to Vancouver, my parents faced many challenges. In China, they were teachers, but in Vancouver, my father chose to continue his education and became a professor. My mother, due to language barriers, could only work in a sewing factory, responsible for sewing clothes. She left home at 7 a.m. and returned at 7 p.m., earning nearly minimum wage. While we were not starving, we were indeed at the bottom of the social ladder. However, we were never in debt because Chinese parents are always accustomed to saving. I saw my parents make tremendous efforts to create better opportunities for me, and this experience deeply influenced me. I developed a habit of frugality, avoiding extravagant spending, but I also learned to work hard. I believe the combination of these two aspects greatly helped my growth.
From a village without running water to my life today, I feel very fortunate. This experience has made me cherish life even more. I remember when I was a child, my mother would walk 300 meters to the village well, carrying two buckets of water back home on a bamboo pole. Being able to move from such a life to where I am today fills me with gratitude.
Anthony:
It's interesting that your career is closely related to innovation and technology, while your childhood life seems to have had almost no technology, right? No running water, no electricity. Did you realize you were missing a lot while growing up? Or did you feel that since everyone around you was similar, this was just the way life was for everyone?
CZ:
As a child, I felt that everyone’s life was like ours. Even now, I maintain that mindset. I believe comparisons between people are relative. In the village, everyone’s living standards were about the same. In fact, my parents were teachers, which was slightly above average in the village. But when we moved to a larger city, I realized that the living conditions in the city were much better. The city we moved to was Hefei, which has one of China’s top universities. On the university campus, I saw paved cement roads for the first time, which were much better than dirt roads. These experiences made me realize that the world is broader than I imagined.
This experience also cultivated my mindset of accepting new things. Early adopters of cryptocurrency often have open minds, and I believe my upbringing contributed to that. I have always felt that I am not much different from others, so I have never felt superior or inferior. I hope I won't be overly arrogant, but I also won't be overly pessimistic. Overall, I have always been an optimist.
Relationship with Parents
Anthony:
I recently watched the NBA draft, where one player talked about living in an environment without electricity, relying on a generator for seven years. You could feel his emotion at that moment when he said, “I came from seven years of living with a generator, my mom sacrificed a lot for me, and now I can play in the NBA.”
While I don't know how well you play basketball, you have reached a top level in the tech field, similar to the NBA. Can you talk about your relationship with your parents? Have you discussed the huge differences between your current life and your upbringing? Have they ever expressed pride in you?
CZ:
I am fortunate to have had a relatively good relationship with my parents. I didn't spend much time with my father because he worked away most of the time to provide us with better living conditions. I spent more time with my mother. She had low expectations of me and was always very frugal. Now she is around 83 or 84 years old, but she still often complains that groceries are too expensive. I often tell her, “Mom, you can buy anything you want now.” But she always maintains her frugal habits.
My father was also a very frugal person. Once, I gave him some money, and after six months or a year, I asked him, “Dad, do you need more money? I can give you some more.” But he refused, saying, “No, I haven't spent the money you gave me last time.” So I only gave him money once. Their lifestyle has hardly changed, and they do not want to change their way of living.
My father passed away two years ago. Although I wasn't particularly close to him, his way of life had a significant impact on me. He was very frugal, lived simply, and never pursued luxury, and my mother is the same. So overall, my relationship with my parents is quite normal; it’s not particularly close, but it’s not distant either.
Experience of Moving to Canada
Anthony:
When you moved to Canada, you were only 12 years old. What are your impressions of that experience? From an American perspective, Canada is sometimes jokingly referred to as the “little brother,” although Canadians may not like that term, it is indeed a very Westernized country, almost the closest place to the U.S. Moving from a village in China to a slightly larger city and then to relatively developed Canada must have been quite shocking for you, right?
CZ:
It was indeed a very special experience. For example, when we first arrived in Canada, a friend of my father drove to the airport to pick us up. For me, this was a big deal because before that, I had never been in a private car. In China, private cars were very rare, and I could only take the bus. A few days later, my father bought a second-hand car for 400 Canadian dollars. I was very excited, thinking, “Wow, we actually have our own car!” Life in Canada was really good; the quality of life here is generally high. The environment is safe, with wide grasslands where I could play with friends. The academic pressure in school was also not too high, relatively relaxed, and I had time to learn English. Overall, the system here is very good. I am very grateful for the youth and university years I spent in Canada, which helped me develop many good habits.
In high school, I particularly enjoyed volleyball, practicing about 15 hours a week. As the captain of the school volleyball team, I held that position for four out of six years. I wasn't the captain from eighth grade to the first semester of ninth grade, but I became the captain starting from the second semester of ninth grade. I not only loved sports but also performed well academically. I had good relationships with the teachers at my school. Our school was small, starting with only 200 students and growing to 400 by graduation. Because the school was small, everyone was familiar with each other. I feel that my youth was one of the best times in my life and greatly contributed to my growth. So I have always held deep gratitude for Canada; it really helped me grow a lot.
Anthony:
What you mentioned reminds me of my wife. She is from Bulgaria, and when she moved to the U.S., she found the math level here to be much simpler than at her original school. In Bulgaria, she was solving equations, while in the U.S., other kids were still doing addition and subtraction. She went from being the worst math student in her class to the best. I think the education system in China is also stricter. So, how was the transition from the Chinese education system to the Canadian education system for you?
CZ:
Yes, my mother, being a high school teacher, didn’t want to take care of me and my sister at home, so she sent us to school two years early. In China, I completed eighth grade before moving to Canada at the age of 12. But when I got to Canada, they decided to put me in elementary school first based on my age. I spent a year in elementary school before moving on to eighth grade in middle school. Although my school year was delayed, I studied math at the tenth-grade level. I also participated in several Canadian national math competitions, such as Fermat and Euclid. These competitions are advanced math contests for middle school students, and I was able to place in the top 100 most years, and in my last year, I even made it to the top 25 and received some small medals. Math has always been my strong suit, naturally guiding me into programming and technology. This part was relatively easy for me.
English, however, was a challenge because it was my second language. I joined the ESL (English as a Second Language) class in high school. Typically, students in these classes find it hard to get an A in regular English classes, but I was able to get an A most of the time. This was thanks to my English teacher, who really liked my writing style. He found my essays interesting, and although my vocabulary was limited, I always managed to add humor to my writing, which he greatly appreciated. My good relationship with him helped me build a lot of confidence in writing. Although my grammar was not good enough and I often made mistakes, my sense of humor did help me a lot. So academically, I excelled in math, while my English improved gradually through hard work.
Career and Life Before Bitcoin
Anthony:
What was your life experience like from graduating high school to encountering Bitcoin? You were about 35 years old, and I’m not very clear on the stories from that time. Where did you go? What jobs did you do? I heard you worked at some financial companies and even returned to Asia. Can you share your experiences?
CZ:
During my fourth year at McGill University, I looked for internships every summer. In my first summer, I found an internship in software development; in my second summer, I continued interning at the same company; in my third summer, I interned at a company in Tokyo that provided trading systems for the Tokyo Stock Exchange. I was responsible for some junior development work. In my fourth year, I continued working at that company, participating in an important project. However, due to project delays, the manager wanted me to extend for a semester to complete the work, as I had become an indispensable part of the project. To avoid affecting the team's progress, I agreed.
However, the project ultimately still did not complete on time, which was not my fault. The project was delayed multiple times, and I did not return to McGill University to complete my degree. Later, I found that not having a degree would complicate applying for a work visa, so I transferred credits through online remote education, took some courses, and eventually obtained my bachelor's degree. After that, I continued working in Tokyo for a few years until the internet bubble burst in 2000. At that time, tech stocks plummeted, and the company I worked for was acquired by a NASDAQ-listed company, but the stock performed poorly after the acquisition, leading many employees to leave. I began looking for new jobs, but recruitment opportunities were very limited. It wasn't until 2001 that Bloomberg was hiring, and I got a job offer through a phone interview.
Just as I was preparing to work in New York, the 9/11 incident happened. I called to confirm whether the job was still available, and they told me the position had not changed and asked if I was still willing to join. I agreed without hesitation. So, in November 2001, I went to New York, just two months after the 9/11 incident. Although the streets seemed unusually quiet, the work environment was very stable, and I worked there for four years.
During my time at Bloomberg, I grew a lot. After joining as a senior developer, I was promoted three times within two years and began managing a team of 60 people, which later expanded to 80, with team members distributed across New York, Princeton, London, and Tokyo. We developed a futures trading system, which was my first full-time involvement in a second-generation trading system. However, in the last two years, I did not receive any further promotions. I found myself to be the youngest manager in the team and the only Asian face. Promotion opportunities were very limited, and it might take a long time to wait.
So, I began to focus on entrepreneurial opportunities. At that time, there was a group of people in Shanghai starting companies, and I thought this might be a good choice. Some senior founders I had worked with in Japan were working on new projects in Shanghai, so I decided to join them and became the youngest partner in the team. In 2005, the six of us founded a company called Fusion Systems. It was a company focused on financial technology solutions, and we expanded our business to Tokyo, Hong Kong, Shanghai, and Los Angeles. Initially, the company was not large, with about 200 people. Although we faced some difficulties, we eventually became profitable, and the partners' lives improved. We persisted like this for eight years, from 2005 to 2013.
In 2013, I was introduced to Bitcoin for the first time. I thought it was a very novel technology, so I tried to get Fusion Systems to develop a Bitcoin payment service similar to BitPay. At that time, I raised $4 million in funding, but the other partners, being older and having limited understanding of Bitcoin's potential, decided not to participate in this project. I then chose to leave and officially enter the Bitcoin industry. This was my career turning point.
Anthony:
Looking back, people can always find some clues in their careers, seeing how the things they have done connect step by step, ultimately leading to success. But these are usually clear only in hindsight, right? When you joined Bloomberg or Fusion, you probably couldn't predict what the future would hold.
First Encounter with Bitcoin in 2013
Anthony:
What was the first thing you did after you encountered Bitcoin for the first time?
CZ:
I first encountered Bitcoin in July 2013, when its price was about $70. It took me about six months to fully understand Bitcoin and build enough confidence. By December 2013, when I completely understood Bitcoin's potential, its price had risen to $1,000, which was the historical high for that year. At that time, I felt I had entered the market too late and needed to act quickly. Therefore, in January 2014, I sold my apartment and used the funds to buy Bitcoin. Every time I received a payment, I would use it to purchase Bitcoin; for example, in January 2014, I bought some at $800 and $600. After that, the price of Bitcoin began to decline. By February or March, when I received my last payment, I bought Bitcoin at about $400. Ultimately, my average purchase price for Bitcoin was around $600.
However, from 2014 to early 2015, the price of Bitcoin hovered between $200 and $150. You could say that my investment lost two-thirds of its value in a short time. Fortunately, my family was very supportive of me, although my mom always nagged, “You silly child, why are you doing this? Why not continue working at Bloomberg? You were earning well back then.” But she only complained and did not stop my decision.
At that time, my thought was that either I had really misjudged the situation, or others had not fully realized Bitcoin's potential. I believed I might have just entered the market early, so I decided to continue to hold on. By 2016, Zhou Xiaochuan, the governor of the People's Bank of China, mentioned blockchain technology for the first time in a public speech. This was the first time the Chinese government publicly referred to blockchain, which sparked widespread attention. After that, China's cryptocurrency industry quickly shifted towards blockchain technology, and market prices began to recover. This period allowed me to experience the first "winter cycle" of the cryptocurrency market, which is a prolonged period of market downturn. After experiencing the first cycle, the second cycle became easier to handle because the market's foundation had become more solid.
The Idea and Process of Founding Binance
Anthony:
So, when did you come up with the idea to create Binance? Was this process done alone, or did you form a team from the beginning?
CZ:
Starting an exchange was not a new idea; almost everyone I encountered in the crypto industry had considered starting an exchange. As early as 2013, we had discussed this idea, but at that time, I felt I didn't have enough experience, so I chose to join an existing exchange. However, the situation there was not ideal, and less than a year later, I chose to leave. After that, I tried to start a Bitcoin exchange in Japan because the world's largest Bitcoin exchange, Mt. Gox, had collapsed in 2014 due to security vulnerabilities. I believed there was a demand for new exchanges in the Japanese market, so I began exploring this direction in 2015.
At that time, I reached out to some venture capital firms to try to raise funds. However, they advised me not to start an exchange directly but to become a technology provider for other exchanges, as they had already invested in some exchanges in Japan and I was good at building systems. So, I found a few partners and began focusing on developing exchange systems. We shifted from originally planning to start our own exchange to focusing on providing technical support for other exchanges. This company achieved good results, and our clients included over 30 exchanges, many of which were small crypto exchanges. Meanwhile, a new phenomenon called "over-the-counter trading" emerged in the Chinese market, and these clients needed order book matching and other system support. We charged clients a monthly fee through a B2B model, and the business developed very steadily.
However, in early 2017, the Chinese government shut down most of our clients because that type of exchange was no longer allowed to operate. At that time, our team had grown to about 25 people, mainly technical staff, with a few salespeople. So we decided to change direction and return to our original intention of starting our own exchange.
I have always believed that the idea itself is not the most important; execution is key. By 2017, we already had a mature system and an efficient team. Although most team members were relatively young and had less experience, they were very talented. At that time, most exchanges still only supported Bitcoin trading, and even large platforms like Coinbase had not yet supported Ethereum. ERC20 tokens on Ethereum were also not widely accepted by mainstream exchanges, and 2017 was the beginning of the ICO boom, with many new projects issuing ERC20 tokens. We seized this market gap and quickly launched services supporting Ethereum and all ERC20 tokens, thus gaining an edge over competitors.
In addition, we made significant improvements in customer service. At that time, if users submitted support requests, they might have to wait more than two months for a response, especially when they were unable to withdraw Bitcoin, which was very painful for users. We decided to provide a service that would respond within 24 hours and ultimately reduced the response time to under one hour. Through high-quality products and excellent service, we successfully attracted a large number of active users and stood out in the industry. These efforts and decisions helped us achieve success in the early stages.
Rapid Growth Phase and Becoming the World's Leading Exchange
Anthony:
During Binance's rapid growth, you launched products that were in high demand in the market, addressing a pain point. I find that many successful business cases can be traced back to their meeting market needs. So, what was your experience like during the rapid rise of Binance in 2017?
At that time, I experienced the cycle of the crypto industry for the first time, and I realized that the market was going to get crazy. It wasn't just about Bitcoin; almost all cryptocurrencies were rising. Then the market experienced a massive crash, and I thought price fluctuations often accompany emotional ups and downs. So how did you handle this situation in the early stages of Binance?
CZ:
You could say that the first eight months were very surreal; everything was unexpected. We officially launched on July 14, 2017, and just six weeks later, the Chinese government announced that it would no longer allow cryptocurrency exchanges to operate. At that time, we faced a choice: should we shut down the company or relocate? My international experience came into play here. I felt that moving was not complicated because I had lived in many countries. So we decided to relocate 30 members of our team from China to Tokyo and no longer base ourselves in China. This might be unimaginable for many businesses, but for us, it was a reality.
At that time, we had no fiat trading channels because banks refused to cooperate with cryptocurrency exchanges, whether in China or other countries. Therefore, we could only focus on blockchain business and become a crypto-to-crypto exchange. Users could deposit Bitcoin, trade Ethereum, and withdraw through the blockchain. Although this model limited our user base in each country, we found that there was a small portion of users in each country willing to use this method. Thus, we gradually developed into a global platform.
After the relocation, the business began to grow rapidly. Two months after launch, we entered the top ten of global exchange rankings; four months later, we broke into the top five and stayed among the top four for about a month. By December 2017, just five months after launch, I received news in Tokyo: “Congratulations, Binance is now the world's number one cryptocurrency exchange.” At the same time, the price of Bitcoin soared from $3,000 at the beginning of the year to $17,000 to $19,000 in December. This almost coincided with the time when our trading volume peaked. However, this also put tremendous pressure on the system.
I remember our CTO hardly had any time to rest. The product manager monitored community dynamics late at night, and once a problem was detected, he would contact the technical officer; the operations manager would wake up in the early morning to check the community situation and would immediately contact the technical officer if any issues arose. During those months, the technical officer was dealing with urgent issues almost every day, and the workload was very intense.
By January 2018, our registration numbers peaked, with 200,000 new users every hour and 300,000 new users every day. The system faced enormous pressure and could not process registration requests in a timely manner. We had to suspend our response service for an hour or even 24 hours. Fortunately, as the price of Bitcoin retreated, the market became a bit calmer, giving us a breather. We used this time to optimize the system and prepare for the next stage of development.
Anthony:
How much did you earn in the first year at Binance? This is an incredible story; you launched a product that quickly became the focus of the market. So how big was the scale?
CZ:
I remember the profit in the first year was about one billion dollars. I think we might be the first company to achieve a billion dollars in profit from a startup.
Anthony:
Was that achieved within the first six months? After all, you launched in July.
CZ:
Yes, most of the profit was realized between the third and eighth months, especially during the third to seventh months, which was our peak trading volume period. Our research found that while some companies reached a billion-dollar valuation faster, from a profitability perspective, we might be the fastest startup to achieve this goal.
Anthony:
Achieving a billion dollars in profit in the first year is truly incredible. What were you thinking at that time? Did you feel very successful, or were you worried that it might all disappear? What were your emotions like? Did you take a moment to celebrate this milestone?
CZ:
At that time, I had a relatively balanced mindset, which was closely related to the price fluctuations of Bitcoin. We held our profits in cryptocurrency and did not convert them into fiat currency because we believed in the long-term value of cryptocurrency. This volatility was something we had to face. I thought as long as we ensured we had enough capital buffer, we could handle any potential downside risks. So I wasn't overly excited, nor did I distribute all the profits to avoid getting into trouble if the market fell.
At the beginning of 2018, the price of Bitcoin dropped from $20,000 to $3,000. This made me realize that the profit figures largely depended on the amount of assets on the platform. We needed to rearrange wallets and transfer billions of dollars in assets. The first time doing such an operation was indeed nerve-wracking, but after doing it a few times, I got used to it and gradually became numb to those numbers. When checking my personal wallet, I had never cashed out those assets, so to me, it felt more like a virtual number rather than actual wealth. This mindset helped me focus on long-term development rather than being troubled by short-term fluctuations.
The 2019 Binance Hack and the "Funds are Safu" Incident
Anthony:
I remember one day while walking the streets of New York, I suddenly heard that Binance had been hacked. Was that in 2018 or 2019? I contacted an executive at Binance to ask if they were okay and if they needed help. The situation was very chaotic at the time, and everyone was trying to figure out what had happened, whether the funds were safe, and so on. Can you talk to us about this incident? Because I think when people hear about Binance making a billion dollars in profit in the first year, they might think everything went smoothly, but in reality, you faced many challenges and difficulties, right?
CZ:
That's right. This incident occurred in May 2019, and we experienced a major hack. Hackers stole 7,000 Bitcoins from our hot wallet, worth about $40 million at the time. To respond to this incident, we suspended the withdrawal function for a week, but trading continued normally to avoid price fluctuations and discrepancies with other exchanges. A few hours after the incident, I participated in a pre-scheduled AMA. Although it was originally planned for the next day, I decided to go live as scheduled and communicate directly with users. Many users analyzed my attitude and performance and believed we had enough funds to handle this crisis.
To provide more context, $40 million in 2019 was equivalent to about a month's revenue for us. While this incident wouldn't bankrupt us, it still made the entire team very tense. We were worried about whether the hackers would further attack other assets. Security issues have always been one of the biggest risks in the crypto industry. After the incident, we developed a detailed response plan, updating progress every two hours on Twitter, explaining the measures we were taking and providing proof of assets. In hindsight, this crisis turned out to be a blessing in disguise.
A week later, we restored the withdrawal function and found that user deposits actually exceeded withdrawal amounts. Many users expressed their recognition and trust in how we handled the incident. I believe this incident taught us an important lesson: transparent and timely communication, taking responsibility proactively, and quickly resolving issues can actually enhance user trust. In fact, we also saw other companies gain more credibility by adopting similar strategies in similar incidents. It truly is a complex business filled with challenges.
Anthony:
We can't talk about this hack incident without mentioning the phrase "funds are safu." Can you explain the origin of this meme?
CZ:
When the incident occurred, I stated publicly that "funds are safu." Later, a YouTuber made a funny video depicting me as a Japanese person, saying "funds are safu" in an exaggerated tone. This video gained widespread attention, and whenever we paused withdrawals or conducted system updates, I would use the phrase "funds are safu" to respond to users. Gradually, I embraced this meme, and the community began to support it, ultimately turning it into a popular internet culture phenomenon.
Anthony:
Every time I see this meme, I can't help but laugh because it is associated with that moment. Well, 2019 has passed, and the hack incident is now behind us. 2020 was clearly a special year, especially after the outbreak of the pandemic. Can you talk to us about that year? Your business was gradually stabilizing and starting to scale, right? I think now everyone around the world who pays attention to crypto finance realizes that crypto finance is successful. So what special things happened in 2020 and 2021?
CZ:
2020 can be considered a warm-up year, while 2021 was an explosive year. In 2019, we launched Binance Launchpad, a platform that helps new projects raise funds through token sales. At that time, we were at the bottom of the crypto winter, with Bitcoin prices around $3,000. We launched many new features through Launchpad to provide users with more options. The market gradually warmed up in 2020, serving as a transition year, while 2021 welcomed a full-blown explosion in the crypto industry.
At the beginning of 2021, Binance had about 20 million users, which grew to 120 million by the end of the year, an increase of 5 to 6 times. In the same year, Bitcoin's price rose to $60,000. Although there was a lot of pressure that year, we were better prepared. The team size expanded, and we gained more experience. While we still faced challenges with customer support and system issues, overall, we had become more mature. This year was not only a year of strong user growth but also a year when Binance's reputation gradually established itself. We were no longer just a new platform but had become a leader in the industry. This is my main memory of that time.
The Bitcoin Boom in 2021 and the Regulatory Environment
Anthony:
At some point, Binance rapidly grew from a niche crypto product to a leading global cryptocurrency trading platform. Eventually, you took the world stage and attracted global attention. As we entered 2021, I noticed that the crypto industry began to face more scrutiny, but at that time, there didn't seem to be much actual action. Clearly, by 2022 and 2023, regulatory pressure had significantly increased. This trend brought challenges to many companies, including Binance.
Can you talk about the explosion of the crypto industry in 2021 and the regulatory friction you faced globally, especially the pressure from the United States?
CZ:
I remember we met in January 2019, during the bear market of the crypto industry, with Bitcoin prices around $3,100. Even when the market was at a low point, our organized meetings still attracted a large number of participants. By 2021, the market experienced explosive growth, and the crypto industry reached new heights.
However, a few months later, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Binance, accusing us of fraud, claiming we misappropriated customer funds, and issued an emergency freeze order attempting to restrict the company's asset flow. To help the company through this tough time, I provided a $250 million loan, but I only recovered the funds after the case was completely dismissed.
Anthony:
Clearly, the regulatory agencies' attention on you has intensified. Can you elaborate on what happened? I feel that many people only see the news headlines, but even I am not very clear on the specifics. What were you accused of? How did these accusations affect you?
CZ:
This incident occurred in November 2022. In December 2022, due to market concerns about the safety of funds on centralized exchanges, Binance experienced a massive user withdrawal. Within a week, we processed about $14 billion in withdrawals, with the highest day being Wednesday, when the withdrawal amount reached $7 billion. That day, I was having dinner in Dubai with some industry insiders, and they remarked on Binance's abundant resources, while I was thinking that I wasn't directly involved in the withdrawal matters.
Despite the pressure, our system operated stably and successfully processed all withdrawal requests without any issues. However, a month later, in January 2023, the SEC filed a lawsuit against us, attempting to link Binance to the collapse of FTX and accusing us of misappropriating user funds. However, during the court proceedings, the judge clearly stated that the SEC had no substantial evidence. All of this is documented and can be publicly verified.
During the SEC's lawsuit, Binance's trading volume accounted for about 35% of Coinbase's global trading volume. In the U.S. market, our market share even reached 50% of Coinbase's. But after the lawsuit, Binance U.S. lost its banking channels, and trading volume quickly dropped to about 1% of Coinbase's. This had a huge impact on our business.
Subsequently, the U.S. Department of Justice (DOJ) also intervened in the investigation. Regarding the DOJ's accusations, I reached a plea agreement with them, admitting to violating a provision of the Bank Secrecy Act. I cannot disclose more details, but the key point is that I became the first person in U.S. history to be sentenced to prison for a single violation of the Bank Secrecy Act, without involving fraud or other criminal activities. This surprised me greatly, but that's how it was. I voluntarily flew to the U.S. to deal with this matter, even though I thought the likelihood of such an outcome was low, but it ultimately happened. I spent four months in prison, and fortunately, everything was fine after I got out.
The Story of Binance and CZ
Anthony:
I think your decision to voluntarily return to the U.S. is quite special. Perhaps you thought the chances of imprisonment were low, but you still chose to face the charges. I imagine no one would advise you to run away, but in reality, many people might choose to avoid it, right? They would say, "I'm not going." So how did you make that decision during this process? Did you talk to friends or family, or what was your mindset like when all this happened?
CZ:
It was a very difficult process. I find it hard to put into words to help people fully understand the complexity of it. It was an unimaginable psychological challenge. Throughout this process, I considered different options multiple times and listened to the advice of friends and lawyers.
I had to weigh my options. If I chose to escape, I could become an international fugitive, and life would become very difficult. I would need to be extremely careful about border checks and might never be able to move freely again. Moreover, my career would be severely impacted. More importantly, many of our users, especially those holding BNB, would suffer losses. The price of BNB would likely plummet, and the entire crypto industry would be affected, potentially even the price of Bitcoin. We have already seen the huge impact on the market when FTX collapsed.
While I could choose to live in a country without an extradition treaty and lead a relatively stable life, that is not the lifestyle I want. I do not want to live a life of evasion and hiding.
I have a certain level of trust in the U.S. judicial system. Although the crypto industry faces political pressure, I believe the U.S. judicial system is still relatively fair. So I thought, why not face it? Even in the worst-case scenario of imprisonment, it might not be for too long. I think the more likely outcome would be house arrest for 6 to 12 months. At least this way, I wouldn't have to interact with other inmates, and my personal safety would be ensured.
Additionally, I had already resigned from my position at Binance and paid a hefty fine, and the company also paid a larger fine. I thought that was enough. So after careful consideration, I decided to face the issues and take responsibility rather than choose to evade.
Anthony:
During this process, I heard that you missed the birth of a child. Is that true?
CZ:
No, I did not miss the birth of my child. My youngest son was born in July 2023, and I flew to the U.S. in November 2023. However, I did miss a minor surgery for another son. When I flew to the U.S., the plea agreement had not yet been finalized. The U.S. government wanted me to stay in the U.S. and promised not to restrict my movements, allowing me to move freely within the country, but they did not want me to leave.
We argued about this, and I paid a $150 million bail, with three friends mortgaging their properties as collateral. I believed I should be allowed to leave the U.S. because I voluntarily flew in to plead guilty. It would be absurd to plead guilty and not appear in court. If someone does not want to come, they should just refuse to plead guilty and fight the case.
The initial judge agreed that I could leave, but the government subsequently appealed. This kind of appeal is very rare, and what was even more surprising was that the judge actually supported the government's request for me to stay in the U.S. I had only brought a small suitcase with a few clothes, and later had to buy new clothes in the U.S. I also missed an important medical surgery for my older son.
Originally, my sentencing process was supposed to take three months, but the government requested a delay on my birthday, and the court agreed to a three-month extension. I requested to leave the U.S., but the court denied it. Therefore, I stayed in the U.S. for six months, away from my family, just waiting for sentencing. After that, I went through another four months of imprisonment.
CZ's Prison Experience
Anthony:
I think anyone with children and a family can understand your situation. My goodness, if they came to the U.S. and couldn't leave or encountered other problems, that would be concerning, right? I think that's understandable. So you were sentenced. As I understand it, you were sentenced to four months in prison, right? I also heard that your first cellmate was a double murderer. Is that true?
CZ:
Yes, that's true.
Interestingly, before I went to prison, between sentencing and incarceration, the government requested that the judge handcuff me for transport to prison. But the judge denied this request because I had behaved well during my bail period, with no violations in six months, and the judge felt there was no need for additional supervision.
After sentencing, I initially thought I would be sent to a minimum-security prison because my crime was classified as white-collar crime. In theory, minimum-security prisons usually have no fences, a more relaxed environment, and inmates can move freely as long as they do not leave the prison without permission. However, because I am not a U.S. citizen, I was placed in a low-security prison.
Low-security prisons mainly house drug offenders and other criminals. My first cellmate was a double murderer serving a 30-year sentence, having already served 18 years. Due to his good behavior, he was downgraded from a medium-security prison to a low-security prison, but he would never be able to enter a minimum-security prison.
Prisons group inmates by ethnicity to reduce conflicts. I was assigned to a group of Asians, Pacific Islanders, and Native Americans. Although my roommate was a double murderer, we got along quite well. He was actually very easygoing, but what I found most unbearable was his snoring while sleeping. On the first night, I hesitated to wake him up, but considering he was a double murderer, I thought better of it. The next morning, I kindly told him, "Bro, your snoring is really loud." He replied, "It's okay, you can wake me up." So I did, and we got along well after that.
Before I went to prison, Bloomberg and The Wall Street Journal reported that I might be the richest person in U.S. prisons. Such reports did not help me; instead, they made me worry about becoming a target for extortion. Fortunately, most people in prison do not pay attention to such media.
Anthony:
Were there any situations that made you feel unsafe, or did anyone try to extort you?
CZ:
Actually, no. I was indeed a bit worried, but I quickly bonded with the people around me and integrated into a group. I made an effort to adapt to the environment and did not show any weaknesses, so no one tried to extort me. While some might try to negotiate better conditions on certain matters, I did not encounter any physical threats.
Anthony:
I can imagine that if a very wealthy and successful person enters a low-security prison, others would definitely seek your advice on investments or cryptocurrency. Did you talk to them about Bitcoin or other cryptocurrencies while in prison?
CZ:
Soon, the inmates and guards learned about my identity, and some inmates showed interest in learning about cryptocurrency and investing. So we managed to get some books about cryptocurrency sent to the prison. I formed a small study group with them, spending 30 minutes each day discussing investment knowledge. I assigned them homework, and they asked questions. There were nine TVs in the prison, one of which was converted to a financial channel to track Bitcoin prices. This study group helped me build supporters and also reduced trouble.
Additionally, some guards asked me if it was a good time to buy Bitcoin. I usually replied, "I don't have internet access here and can't get market information, so I can't give advice." Although my friends would send me some market updates via mail, I still kept a low profile to avoid drawing unnecessary attention.
Overall, the guards were relatively friendly towards me. I did not encounter any major violent incidents in prison; of course, there were occasional fights, but they had nothing to do with me. I believe the U.S. prison system, at least the low-security prison I was in, is relatively safe.
Views on Clemency and Legal Battles
Anthony:
We just mentioned the story of Marc Rich, and I find it really interesting that you read that book. I love that you said you treated it as a textbook for learning, and you also mentioned the case of Mike Milken. Throughout history, many people who have been accused, convicted, or even imprisoned have ultimately received clemency. I noticed that the current government has also granted clemency to some offenders, including drug offenders and some white-collar criminals. Clemency is usually a complex process, so have you considered applying for clemency? Can you talk about your views on clemency?
CZ:
I certainly hope to receive clemency, but to be frank, I am not very familiar with the process. For any offender, receiving clemency is obviously an ideal outcome, especially in my case, where I think there may be some political factors involved. Five days before my sentencing, Senator Elizabeth Warren declared war on cryptocurrency again on national television and wrote an open letter to the Department of Justice. So whether political factors are involved, I cannot be sure. Clemency applications are usually handled by lawyers, and I do not want to comment further on that.
Anthony:
So regarding the legal battle, how do you view the charges you are facing? You have already pleaded guilty, but do you think there are elements of a legal battle in the investigation and prosecution process?
CZ:
I think there are clear signs of a legal battle in the case with the Securities and Exchange Commission (SEC). Our case has now been dismissed with prejudice, indicating that the new government is more reasonable in regulating the market. I feel they are starting to understand the complexities of new technologies and new industries and are trying to find a balance between encouraging innovation and protecting consumers.
We have indeed seen a shift in attitude. Not just in my case, but if you observe President Trump, he is clearly a major target of legal battles and political objectives. During my time in prison, I heard that President Trump attended a Bitcoin conference in Nashville in July and publicly announced his support for cryptocurrency. I also heard that Kamala Harris expressed support for cryptocurrency. This surprised me greatly because I had been in prison for less than two months, and it seemed the government's attitude had shifted.
Additionally, I read that President Trump was charged with a crime for taking some documents to the bathroom. I find that a bit extreme. If my employees did that, I might reward them because it shows they are making good use of their time reading documents. This situation makes me feel that the definition of a legal battle is very subjective, especially in the context of the previous administration's clearly hostile attitude towards cryptocurrency. Elizabeth Warren has repeatedly issued warnings about cryptocurrency, and Gary Gensler has initiated multiple lawsuits. Now we see the new government being more friendly towards cryptocurrency and having a deeper understanding of finance and technology. So I believe there may indeed be a legal battle, but the specifics remain quite complex.
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