THE BNB token, a cryptocurrency linked to Binance and its incarcerated co-founder Zhao Changpeng, surged to a record high in the first week of his four-month jail sentence in the US.
Its rally underscores Zhao’s status as the richest person ever to do time in a US federal lock up. Zhao reported to a prison in California on Tuesday (Jun 4) to begin a four-month sentence for failing to properly safeguard the world’s largest crypto exchange against money laundering.
The price of BNB climbed to a peak of US$717.48 on Thursday, lifting its market capitalisation to US$109 billion, according to data from CoinGecko. The token has more than doubled in price since the start of the year.
The trajectory of BNB also reflects the fortunes of Binance itself. The total value of assets on the exchange has swollen from around US$80 billion in early January to US$125 billion today, cementing its dominance even after a precarious period last year that culminated in the company paying a historic US$4.3 billion fine to settle a case with US authorities.
Holders of BNB get trading-fee discounts on Binance and the token is also used to settle fees on BNB Smart Chain, a blockchain popular with crypto apps, including games and exchanges.
BNB’s recent rally was foreshadowed in derivative market trading patterns from late May, with spot demand starting to pick up in June and buying consistently outpacing selling between Jun 2 to 5, according to Kaiko analyst Dessislava Aubert.
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BNB trades on more than a dozen centralised exchanges, she said, “which differs from other exchange tokens that are almost exclusively traded on their affiliated platforms”. Binance still accounts for 85 per cent of BNB volume globally, she added.
Binance had been accused of anti-money laundering and sanctions breaches that included failing to prevent Hamas, Al Qaeda and other militant groups from accessing the exchange. Zhao also agreed to pay a US$50 million personal fine to settle the charges.
That is a drop in the bucket of Zhao’s net worth, which is estimated to stand at US$38.5 billion – though the exact composition of the fortune is unknown. Zhao said in a 2021 interview with the Associated Press that the majority of his net worth was denominated in BNB, adding that he is a “decent sized shareholder in Binance”.
The man known as “CZ” is currently ranked as the 40th richest person in the world and has seen his net worth grow by US$4.1 billion in 2024, according to the Bloomberg Billionaires Index.
While Zhao has never disclosed exactly how much BNB he owns, a 2017 whitepaper from BNB’s initial coin offering or ICO shows that 80 million tokens, today worth about US$56 billion, were allocated to the founding team. The money raised through that ICO was used to launch the Binance exchange. BLOOMBERG
