Compiled & Edited by: TechFlow

Translator: Naetitia

"To build a successful company, you must have strong conviction and a clear worldview. You need to recognize certain trends earlier than others."

Guest: Changpeng Zhao, Founder of Binance

Host: Anthony Pompliano

Source: Anthony Pompliano Podcast

Original Title: The King of Crypto: CZ’s Rapid Rise

Key Insights 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 buying Bitcoin for the first time in 2013, navigating the ups and downs of the crypto market, to his outlook on the future. The discussion spans his childhood experiences, career trajectory, the story behind founding Binance, and the challenges he has faced in the crypto industry.

Highlights from the conversation:

• "I missed the internet wave, but when Bitcoin emerged 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 went all-in on crypto."

• "Traditional financial markets will likely enter the cryptocurrency space on a much larger scale."

• "Bitcoin, blockchain, and artificial intelligence are three core technologies I’ve encountered in my adult life."

• "What truly limits me isn’t money but other factors like talent, team, health, and time—these are the scarce resources. So now, I focus more on these aspects."

• "I’ve always felt that I’m not much different from others, and as a result, I’ve never had a sense of superiority or inferiority. I hope I’m neither overly arrogant nor overly pessimistic."

• "I believe the United States has the potential to become the global hub for cryptocurrency, and we hope to contribute to this effort. It’s like we’re in a simulated environment—when faced with challenges, we simply need to do our best and keep moving forward."

• "Building an exchange is not a new idea. Almost everyone I’ve talked to in the crypto industry has considered creating an exchange at some point. I’ve always believed that ideas themselves aren’t the most important thing—it’s execution that matters."

• "To build a successful company, you must have strong conviction and a clear worldview. You need to recognize certain trends earlier than others."

• "Binance’s first-year profit was approximately $1 billion, making it possibly the first startup to achieve such profitability."

• "We hold our profits in cryptocurrency rather than converting them into fiat because we believe in the long-term value of crypto."

• "When I look at my personal wallet, I’ve never cashed out these assets. They feel more like virtual numbers than actual wealth. This mindset helps me focus on long-term development rather than being distracted by short-term fluctuations."

• "Although I could choose to live in countries without extradition treaties and lead a relatively stable life, that’s not the lifestyle I want. I don’t want to live a life of evasion and hiding."

• "I have a degree of trust in the U.S. judicial system. Despite the political pressures facing the crypto industry, I believe the U.S. judicial system remains relatively fair."

The Role of Bitcoin and Cryptocurrency in the World

Anthony: CZ, as one of the most influential entrepreneurs globally, you’ve not only achieved personal success but also led Binance to become a leading entity in the crypto industry. However, I think many people outside the crypto space don’t fully grasp how large companies like Binance grow or understand the magnitude of your achievements.

For those who reach the pinnacle in their chosen fields, their worldview often becomes fascinating. Considering that you’ve built your company within the crypto industry, let’s talk about Bitcoin and cryptocurrency. What do you think their role is in the world, and how do you see their importance evolving in the future?

CZ: Of course. I think you’ve touched on a key point. Over the years, I’ve learned that to build a successful company, you must have strong conviction and a clear worldview. You need to recognize certain trends earlier than others.

I feel fortunate to have been exposed to Bitcoin early on. This is our third podcast recording. Back in 2013 and 2014, when I first encountered Bitcoin, I thought, “This technology is incredible; it’s going to be a bigger revolution than the internet.” I missed the internet wave, but when Bitcoin emerged 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 went all-in on crypto.

I believe this unwavering conviction is crucial. Blockchain technology isn’t just limited to the realm of currency; it can be applied to any scenario requiring verification in the future. Traditional databases can store data, but they can’t easily verify it, whereas blockchain provides a more reliable way to validate information. The potential for this technology in the financial sector is immense, and we’re still in the early stages of its application in the financial world. To me, this is a transformative technological opportunity that cannot be missed. The next major technological revolution might appear 10 to 15 years from now, but for now, we’re also seeing artificial intelligence as a significant direction. I think Bitcoin, blockchain, and AI are three core technologies I’ve encountered in my adult life. This worldview is essential for building platforms and driving industry growth.

Anthony: You mentioned worldview, which is clearly tied to personal experiences. You’ve worked in various types of companies and encountered different living environments. These experiences seem to have helped you cultivate empathy and intuition. Intuition is like your human algorithm—the more you’re exposed to, the better you can identify potential. When you first encountered Bitcoin, what made you believe it would be so impactful? Was it the technology itself, price trends, or some market factor? What convinced you it would change the world?

CZ: I was fortunate to have lived in different countries. This gave 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. These global experiences made me realize that currency shouldn’t be restricted by national borders. When moving between countries, I had to exchange money, and during my journey from Japan to New York, I lost a significant amount due to exchange rates. This made me aware of the limitations of the monetary system.

Additionally, I have a technical background. As early as 1998, I used PGP encryption technology, which allowed me to understand Bitcoin’s cryptographic algorithms. I also worked on Wall Street, gaining fintech experience at Bloomberg and Tokyo Stock Exchange systems. These backgrounds helped me grasp Bitcoin’s potential earlier. At the same time, I observed that the Bitcoin community in 2013 was filled with innovation and collaboration, which further strengthened my conviction.

I think the combination of these experiences allowed me to recognize Bitcoin’s value earlier than others and gave me the determination to stay in this industry. I believe all of this contributes to one’s perspective or understanding of the world. Having a global perspective rather than a national one is extremely important.

CZ’s Vision for the Future of the Crypto Industry

Anthony: You are one of the most successful entrepreneurs of our generation. People are curious about your financial situation. Could you share some insights openly? Everyone wants to know how successful you truly are, and wealth often seems to be a measure of success.

CZ: I know I have enough money to live comfortably and enough resources to do the things I want to do. For me, money is a tool that enables me to pursue endeavors I find meaningful. For instance, if I want to start a business that helps others and creates a positive impact, I have the resources to make it happen. But what truly limits me isn’t money; it’s other factors like talent, team, health, and time—these are the scarce resources. So now, I focus more on these aspects rather than money itself.

Anthony: Bitcoin was clearly your first love in this industry, and you’ve successfully built a globally leading exchange. Where do you think the crypto industry is heading now? Especially as more countries begin to support cryptocurrency and hundreds of millions of people have started registering to use these assets.

CZ: I’m very optimistic about this market. Some of the world’s most powerful governments are driving cryptocurrency adoption. For example, we’re seeing public companies holding Bitcoin reserves, which is a remarkable development. I believe we’ll see more institutional adoption in the future, such as ETFs, public reserves, Bitcoin reserves, and more. Additionally, companies are introducing BNB reserves and Ethereum reserves, which are positive trends.

I think traditional financial markets will also enter the cryptocurrency space on a much larger scale. On the innovation side, we’ll see more intersections between artificial intelligence and blockchain. This convergence is expanding rapidly. For example, blockchain technology has already been adopted by many governments for decentralized identity, land registration, medical benefit distribution, taxation, and other applications. This demonstrates that blockchain is evolving from a singular financial tool to a multidimensional solution. These developments are incredibly exciting.

If you had asked me nine months ago, I wouldn’t have predicted that we’d be in the environment we’re in today.

This also reflects the importance of changes in governmental structures. Elections can quickly bring new ideas and innovative policies. I believe the United States has the potential to become the global hub for cryptocurrency, and we hope to contribute to this effort. Although we’re currently facing some restrictions, we look forward to making more contributions in the future.

Anthony: It’s kind of crazy, isn’t it? You are the world’s largest crypto exchange, yet you’re not in the United States.

CZ: We hope to enter the U.S. market. Currently, crypto exchanges in the United States charge about 10 to 20 times more than those in other regions globally. This is somewhat unusual because, in the U.S., other goods are typically cheaper, and delivery is faster. For example, when I use Amazon in the U.S., products are cheaper and arrive faster. But in the crypto space, U.S. consumers pay higher fees and have fewer options. We hope to change this situation, but for now, we are constrained by regulations, and we need to address them step by step.

I think we’re like operating in a simulated environment—when faced with challenges, we just need to do our best and keep moving forward. I also want to thank you for your support over the years. While we haven’t had many opportunities to collaborate, I’ve always respected your contributions to the industry. You’ve been a rational voice in the U.S. crypto sector. I deeply appreciate everything you’ve done, and I hope we can have more opportunities to collaborate in the future.

CZ’s Childhood and Early Life

Anthony: Although we’ve known each other for a while, I’ve realized that most people focus on your professional achievements and know very little about your childhood. When I spoke to others and learned more, I discovered that your upbringing in China was actually quite challenging. Could you share what your childhood was like?

CZ: I was born in a rural area in China and later moved to an even smaller village. Before I could remember, we didn’t have running water or electricity at home. During my primary school years, I often studied under an oil lamp with a glass cover. A few years later, we installed a water pump to draw water, and then eventually got electricity. Later, we moved to a small city in China and eventually emigrated to Canada. All of this happened before I turned 12, so my life underwent significant changes during those early years.

Even after moving to Vancouver, my parents faced numerous challenges. In China, they were teachers, but in Vancouver, my father chose to pursue further studies to become a professor. My mother, due to language barriers, worked in a sewing factory, stitching clothes. She left home at 7 a.m. and returned at 7 p.m., earning close to minimum wage. While we never went hungry, we lived on the lower rungs of society. However, we never went into debt because Chinese parents are accustomed to saving. I witnessed my parents’ tremendous efforts to provide me with better opportunities, which deeply influenced me. I developed a habit of frugality and avoided extravagant spending, but I also learned the value of hard work. I believe this combination greatly shaped my growth.

From a village with no running water to the life I have today, I feel incredibly fortunate. This experience has made me cherish life even more. I remember my mother walking 300 meters to the village well, carrying two buckets of water on a bamboo pole. To have come from that kind of life to where I am now, I am filled with gratitude.

Anthony: It’s fascinating that your career is deeply tied to innovation and technology, yet your childhood seems to have been almost devoid of technology, right? No running water, no electricity. Did you feel like you were missing out while growing up, or did everyone around you live similarly, making it seem like that was just the way life was?

CZ: As a child, I thought everyone lived the same way we did. Even now, I maintain that mindset. I believe comparisons between people are relative. In the village, everyone’s standard of living was similar. In fact, my parents were teachers, which placed us slightly above average in the village. But when we moved to a larger city, I realized urban living conditions were much better. The city we moved to was Hefei, home to one of China’s top universities. On the university campus, I saw paved roads for the first time, which were far better than dirt roads. These experiences made me realize the world was broader than I had imagined.

This upbringing also cultivated a mindset of openness to new things. Early adopters of cryptocurrency often have open minds, and I believe my childhood experiences contributed to this. I’ve always felt I’m not much different from others, so I’ve never had feelings of superiority or inferiority. I hope I’m neither overly arrogant nor overly pessimistic. Overall, I’ve always been an optimist.

Relationship with Parents

Anthony: I recently watched the NBA Draft, where one player spoke about living without electricity for seven years, relying on a generator. You could feel his emotions as he said, “I’ve come from living with a generator for seven years; my mom sacrificed so much for me, and now I can play in the NBA.”

While I don’t know how good your basketball skills are, you’ve certainly reached an NBA-like level in the tech industry. Can you talk about your relationship with your parents? Have you ever discussed the stark differences between your current life and your upbringing? Have they expressed pride in your achievements?

CZ: I’m fortunate to have a reasonably good relationship with my parents. I didn’t spend much time with my father because he was often away, working to provide better living conditions for us. I spent more time with my mother. She didn’t have high expectations for me and was always very frugal. Now, she’s around 83 or 84 years old, but she still frequently complains about groceries being too expensive. I often tell her, “Mom, you can buy anything you want now.” But she remains steadfast in her frugal habits.

My father was also extremely frugal. Once, I gave him some money, and six months or a year later, I asked, “Dad, do you need more money? I can give you some.” 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 don’t want to change it.

My father passed away two years ago. While I wasn’t particularly close to him, his way of life greatly influenced me. He lived simply and frugally, never chasing luxury, and my mother is the same. So overall, my relationship with my parents is normal—not particularly close, but not distant either.

Experience of Moving to Canada

Anthony: When you moved to Canada, you were only 12 years old. What was that experience like? From an American perspective, Canada is sometimes jokingly referred to as the “little brother,” although Canadians might not appreciate that term. Still, it’s a very Westernized country, almost the closest thing to the U.S. From a village in China to a somewhat larger city, and then to relatively developed Canada, such a transition must have been quite shocking, right?

CZ: It was indeed a very special experience. For instance, when we first arrived in Canada, one of my father’s friends picked us up from the airport in his car. To me, that was a big deal because I’d never been in a private car before. In China, private cars were extremely rare, and I could only take buses. A few days later, my father bought a second-hand car for $400. I was so excited and thought, “Wow, we actually have our own car!” Life in Canada was really good; the quality of life there was generally high. The environment was safe, the lawns were spacious, and I could play with friends. School was less stressful, and I had time to learn English. Overall, the system was very good. I’m very grateful for the teenage years and university time I spent in Canada, as they helped me develop many good habits.

In high school, I particularly loved volleyball, practicing about 15 hours a week. As the captain of the school volleyball team, I held that role for four out of six years. I wasn’t the captain in eighth grade or the first half of ninth grade, but starting from the second half of ninth grade, I became captain. I was passionate about sports and also performed well academically. I had great relationships with the teachers at school. Our school was small, initially with only 200 students, and by graduation, it grew to 400. Because of the small size, everyone knew each other well. I feel my teenage years were one of the best periods of my life and greatly contributed to my growth. So I’ve always been deeply grateful to Canada; it truly helped me grow a lot.

Anthony: What you mentioned reminds me of my wife. She’s from Bulgaria, and when she moved to the U.S., she found the math level here much simpler than in her previous school. In Bulgaria, she was solving equations, whereas in the U.S., kids were still doing addition and subtraction. She went from being the worst math student in her class to the best. I imagine the Chinese education system is also much stricter. What was the transition like for you, moving from the Chinese education system to the Canadian one?

CZ: Yes, my mother, being a high school teacher, didn’t want to stay home to take care of me and my sister, so she sent us to school two years early. In China, I finished eighth grade before moving to Canada at age 12. But in Canada, they placed me in elementary school based on my age. I spent a year in elementary school before entering middle school in eighth grade. Although my school year was delayed, I studied math at a tenth-grade level.

I also participated in multiple Canadian national math competitions, such as Fermat and Euclid. These competitions were advanced math contests for high school students, and most years, I ranked in the top 100. In my final year, I even made it to the top 25, earning some small medals. Math has always been my strength, naturally leading me into programming and technology. This part of my education was relatively easy for me.

English, however, was my challenge as it was my second language. In high school, I joined ESL (English as a Second Language) classes. Typically, students in these classes struggled to get an A in regular English courses, but I managed 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; though my vocabulary was limited, I always added a touch of humor to my writing, which he appreciated. My good relationship with him gave me a lot of confidence in writing. While my grammar wasn’t perfect, and I often made mistakes, my sense of humor helped me a lot. So academically, I excelled in math, while my English improved steadily through effort.

Career and Life Before Bitcoin

Anthony: What was your life like between graduating high school and discovering Bitcoin? You’re about 35 years old, and I don’t know much about this period of your story. Where did you go? What jobs did you do? I’ve 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 sought internships every summer. In my first summer, I found a software development internship; in the second summer, I continued at the same company. In the third summer, I interned at a company in Tokyo that provided trading systems for the Tokyo Stock Exchange. I worked on some entry-level development tasks. In my fourth year, I continued working at this company, contributing to an important project. However, the project faced delays, and the manager asked me to extend my term by one semester because I had become an indispensable part of the team. To avoid affecting the team’s progress, I agreed.

Unfortunately, the project still didn’t finish on time, which wasn’t my fault. It faced multiple delays, and I didn’t return to McGill University to complete my degree. Later, I realized that not having a degree could make it difficult to apply for work visas. So I transferred my credits through online remote education, took some courses, and eventually earned my bachelor’s degree. After that, I continued working in Tokyo for a few years until the dot-com bubble burst in 2000. At that time, tech stocks plummeted, and the company I worked for was acquired by a Nasdaq-listed company. However, after the acquisition, the stock performed poorly, and many employees left. I began looking for new opportunities, but hiring was extremely limited.

In 2001, Bloomberg was hiring, and I secured a job through a phone interview. Just as I was preparing to move to New York, the 9/11 attacks happened. I called to confirm whether the job was still available, and they assured me it was, asking if I was still willing to join. I didn’t hesitate and agreed. In November 2001, I went to New York, just two months after the 9/11 attacks. Although the streets were eerily quiet, the work environment was very stable, and I worked there for four years.

During my time at Bloomberg, I grew significantly. Joining as a senior developer, I was promoted three times within two years, eventually managing a team of 60 people, which later expanded to 80. The team was spread across New York, Princeton, London, and Tokyo. We developed a futures trading system, marking my first full-time involvement in a second-generation trading system. However, I didn’t receive further promotions in the last two years. I noticed I was the youngest manager in the team and the only Asian face. Promotion opportunities were very limited and would require a long wait.

So I started exploring entrepreneurial opportunities. At the time, a group of people in Shanghai was working on a startup, and I thought it might be a good choice. Some senior founders I had worked with in Japan were now working on new projects in Shanghai, so I decided to join them as the youngest partner in the team. In 2005, six of us founded a company called Fusion Systems. It was a fintech solutions company, and we expanded our business to Tokyo, Hong Kong, Shanghai, and Los Angeles. Initially, the company was small, with about 200 people. Although we faced some challenges, we eventually became profitable, and the partners’ lives improved significantly. We persevered for eight years, from 2005 to 2013.

In 2013, I encountered Bitcoin for the first time. I found it to be a very novel technology and tried to get Fusion Systems to develop a Bitcoin payment service similar to BitPay. At the time, I raised $4 million in funding, but my older partners didn’t fully understand Bitcoin’s potential and decided not to pursue the project. I then chose to leave and officially entered the Bitcoin industry. This marked a turning point in my career.

Anthony: Looking back, people often find clues in their careers that show how their actions connected step by step to ultimately lead to success. But these connections are usually only clear in hindsight, right? When you joined Bloomberg or Fusion, you probably couldn’t predict how the future would unfold.

First Encounter with Bitcoin in 2013

Anthony: What was the first thing you did after discovering Bitcoin?

CZ: I first encountered Bitcoin in July 2013, when it was priced at around $70. It took me about six months to fully understand Bitcoin and build enough confidence in it. By December 2013, when I completely grasped Bitcoin’s potential, its price had already risen to $1,000, marking that year’s all-time high. At the time, I felt I was late to the game and needed to act quickly. So, in January 2014, I sold my apartment and used the funds to buy Bitcoin. Whenever I received payments, I would use them to purchase Bitcoin. For instance, in January 2014, I bought Bitcoin at $800 and $600. Later, Bitcoin’s price started to drop. By February or March, when I received my final payment, I bought Bitcoin at around $400. Ultimately, my average purchase price for Bitcoin was approximately $600.

However, from 2014 to early 2015, Bitcoin’s price hovered between $200 and $150 for 18 months. You could say my investment lost two-thirds of its value in a short time. Fortunately, my family was very supportive, although my mom often nagged, saying, “You silly child, why are you doing this? Why not continue working at Bloomberg? You had a great income back then.” But she didn’t stop me from making my decision.

At the time, I thought either I was completely wrong in my judgment, or others hadn’t fully realized Bitcoin’s potential yet. I believed I might have just entered the market early, so I decided to stick with it. By 2016, Zhou Xiaochuan, the governor of China’s central bank, publicly mentioned blockchain technology for the first time. This was the first official acknowledgment of blockchain by Chinese authorities, generating widespread attention. Subsequently, China’s cryptocurrency industry quickly shifted its focus to blockchain technology, and market prices began to recover. This period marked my first experience of a “crypto winter,” a prolonged downturn in the market. After going through the first cycle, subsequent cycles became easier to handle as the market foundation grew stronger.

The Idea and Process of Creating Binance

Anthony: When did you come up with the idea to create Binance? Was this something you did alone, or did you assemble a team from the start?

CZ: Starting an exchange wasn’t a new idea; almost everyone I met in the crypto industry had considered starting an exchange. As early as 2013, we discussed this idea, but at the time, I felt I lacked enough experience, so I chose to join an existing exchange. However, things didn’t go well there, and I left within a year. Later, I tried to start a Bitcoin exchange in Japan because the world’s largest Bitcoin exchange, Mt. Gox, collapsed in 2014 due to security vulnerabilities. I believed the Japanese market needed a new exchange, so I began exploring this direction in 2015.

At the time, I approached some venture capital firms to raise funds. They suggested I shouldn’t start an exchange directly but instead become a technology provider for other exchanges since they had already invested in some exchanges in Japan, and I was skilled at building systems. So I teamed up with a few partners and focused on developing exchange systems. We shifted from planning to start our own exchange to providing technical support for other exchanges. This company achieved good results, serving over 30 exchanges, many of which were small crypto exchanges. Meanwhile, a new phenomenon called “over-the-counter trading” emerged in China, and these clients needed systems like order book matching. We adopted a B2B model, charging clients monthly fees, and the business grew steadily.

However, in early 2017, the Chinese government shut down most of our clients because they no longer allowed that type of exchange to operate. By then, our team had grown to about 25 people, mainly technical staff with a few salespeople. So we decided to pivot and return to our original intention of starting our own exchange.

I’ve always believed that execution is more important than the idea itself. By 2017, we had a mature system and a highly efficient team. Although most team members were relatively young and inexperienced, they were incredibly talented. At the time, most exchanges only supported Bitcoin trading; even large platforms like Coinbase hadn’t yet added Ethereum. ERC20 tokens on Ethereum weren’t widely accepted by mainstream exchanges either, while 2017 marked 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, gaining an edge over competitors.

Additionally, we made significant improvements in customer service. At the time, if users submitted support requests, they might have to wait over two months for a response, especially when unable to withdraw Bitcoin—a painful experience for users. We decided to offer responses within 24 hours and eventually reduced the response time to under an hour. By providing quality products and exceptional service, we 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 phase, you launched products that the market desperately needed, solving a key pain point. I’ve noticed that many successful business stories trace back to meeting market demands. So, during Binance’s meteoric rise in 2017, what was your experience like?

At that time, I experienced my first crypto market cycle and realized the market was going to become chaotic. It wasn’t just about Bitcoin; almost all cryptocurrencies were surging. Then the market faced a major crash, and I imagine price volatility is often accompanied by emotional swings. How did Binance cope with this situation in its early days?

CZ: The first eight months were surreal, to say the least—everything was beyond expectation. We officially launched on July 14, 2017, and just six weeks later, the Chinese government announced that cryptocurrency exchanges were no longer allowed to operate. At that point, we faced a choice: shut down the company or move elsewhere. This is where my international experience came into play. I felt relocation wasn’t overly complicated since I had lived in many countries. So, we decided to move our 30-member team from China to Tokyo and no longer base ourselves in China. For many businesses, this might seem unimaginable, but for us, it was a reality.

At the time, we didn’t have any fiat trading channels because banks—whether in China or other countries—refused to work with cryptocurrency exchanges. As a result, we focused solely on blockchain business, becoming a crypto-to-crypto exchange. Users conducted Bitcoin deposits, Ethereum trades, and withdrawals entirely through the blockchain. While this model limited our user base in each country, we found that every country had a small group of users willing to use this method. Gradually, we grew into a global platform.

After the relocation, our business began to expand rapidly. Two months after launch, we entered the top ten global exchanges; four months later, we made it into the top five and stayed among the top four for about a month. By December 2017, just five months after launch, I received a message in Tokyo: “Congratulations, Binance is now the world’s number one cryptocurrency exchange.” Meanwhile, Bitcoin’s price soared from $3,000 at the start of the year to $17,000–$19,000 in December. This coincided almost perfectly with our trading volume reaching the top, but it also placed enormous pressure on our systems.

I remember our CTO barely had any rest. Product managers monitored community dynamics late at night and contacted the CTO if issues arose; operations managers woke up at dawn to check the community, and they too would contact the CTO if needed. During those months, the CTO was constantly handling urgent problems, working under intense pressure.

By January 2018, our registration numbers peaked, with 200,000 new users per hour and 300,000 new users per day. The system faced enormous stress, even struggling to process registration requests in time. We had to suspend services for an hour or sometimes even 24 hours. Fortunately, as Bitcoin’s price retreated, the market calmed down slightly, giving us a breather. We used this time to optimize the system and prepare for the next stage of growth.

Anthony: How much profit did Binance make in its first year? This is an incredible story—you launched a product that quickly became the market’s focal point. So, how big was the scale?

CZ: I remember the first year’s profit was approximately $1 billion. I think we might have been the first startup to achieve $1 billion in profit.

Anthony: Was that within the first six months? After all, you launched in July.

CZ: Yes, most of the profit was made between the third and eighth months, especially during the third to seventh months when our trading volume was at its peak. While some companies reached a $1 billion valuation faster, in terms of profitability, we might have been the fastest startup to achieve this milestone.

Anthony: Reaching $1 billion in profit in the first year is truly remarkable. What were you thinking at the time? Did you feel incredibly successful, or were you worried it might all disappear? What were your emotions like? Did you stop to celebrate this milestone?

CZ: I maintained a balanced mindset, which was closely tied to Bitcoin’s price fluctuations. We held our profits in cryptocurrency rather than converting them to fiat because we believed in the long-term value of crypto. This volatility was something we had to face. I thought that as long as we ensured enough financial buffer, we could handle any potential downside risks. So, I wasn’t overly excited, nor did I distribute all the profits, to avoid being caught off guard if the market declined.

In early 2018, Bitcoin’s price fell 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 had to rearrange wallets and transfer billions of dollars worth of assets. The first time doing such operations was nerve-wracking, but after a few times, you get used to it and become numb to the numbers. When checking my personal wallet, I never cashed out those assets, so to me, it felt more like virtual numbers rather than actual wealth. This mindset helped me focus on long-term development rather than being distracted by short-term fluctuations.

The 2019 Binance Hack and 'Funds Are Safe' Incident

Anthony: I remember walking down the streets of New York one day and suddenly hearing that Binance had been hacked. Was that in 2018 or 2019? At the time, I reached out to a Binance executive to check if they were okay and needed help. The situation was very chaotic, with everyone trying to figure out what had happened and whether funds were safe. Can you tell us about this incident? Because when people hear that Binance went from zero to $1 billion in profit in its first year, they might assume everything went smoothly. But you’ve also faced many challenges and difficulties, right?

CZ: That’s correct. This happened in May 2019 when we experienced a major hack. Hackers stole 7,000 bitcoins from our hot wallet, worth about $40 million at the time. To respond to the incident, we paused withdrawals for a week, although trading remained operational to avoid price discrepancies with other exchanges. A few hours after the incident, I participated in a pre-scheduled AMA. While it was originally planned for the next day, I decided to proceed as scheduled to communicate directly with users. Many users analyzed my attitude and concluded that we had sufficient funds to handle the crisis.

For context, $40 million in 2019 was equivalent to about one month of revenue for us. While this incident wouldn’t bankrupt us, it still made the entire team very nervous. We were worried about whether hackers might further attack other assets. Security remains the biggest risk in the crypto industry. After the incident, we developed a detailed response plan, providing updates every two hours via Twitter to inform users about our actions and offer proof of assets. In hindsight, this crisis turned out to be a blessing in disguise.

A week later, we resumed withdrawals and found that user deposits exceeded withdrawals. Many users appreciated how we handled the situation, recognizing and trusting our approach. I believe this incident taught us an important lesson: transparent and timely communication, taking responsibility, and resolving issues quickly can actually enhance user trust. In fact, we’ve seen other companies adopt similar strategies during similar incidents, gaining more credibility as a result. It’s indeed a complex business filled with challenges.

Anthony: We can’t talk about this hack without mentioning the phrase “funds are safu.” Can you explain the origin of this meme?

CZ: During the incident, I stated publicly, “Funds are safe.” Later, a YouTuber created a funny video portraying me as a Japanese person saying “funds are safu” in an exaggerated tone. The video gained widespread attention, and every time we paused withdrawals or conducted system updates, I would use the phrase “funds are safu” to reassure users. Gradually, I embraced the meme, and the community started supporting it. Eventually, it became a popular internet cultural phenomenon.

Anthony: Every time I see this meme, I can’t help but laugh because it’s tied to that moment. Alright, 2019 is behind us, and the hack incident is in the past. 2020 was obviously a unique year, especially with the pandemic. Can you tell us about that year? By then, your business was stabilizing, and you were expanding, right? I think by now, anyone paying attention to crypto finance globally realizes it’s a success. So, what happened in 2020 and 2021?

CZ: 2020 was more of a warm-up year, while 2021 was a breakout year. In 2019, we launched Binance Launchpad, a platform that helps new projects raise funds through token sales. At the time, we were at the bottom of the crypto winter, with Bitcoin priced around $3,000. Through Launchpad, we introduced many new features, offering users more choices. 2020 saw the market gradually recover, serving as a transitional year, while 2021 marked the full-fledged explosion of 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—a 5 to 6-fold increase. Bitcoin prices surged to $60,000 during the same year. While the year was stressful, we were better prepared. The team had grown larger and more experienced. Although we still faced challenges with customer support and system issues, overall, we had become more mature. That year wasn’t just about strong user growth but also about Binance’s reputation being solidified. We were no longer just a new platform but had become a leader in the industry. That’s my primary memory of that time.

Bitcoin's Explosion in 2021 and Regulatory Challenges

Anthony: At some point, Binance grew from a niche crypto product into the world's leading cryptocurrency exchange platform. Eventually, you stepped onto the global stage and attracted worldwide attention. Entering 2021, I noticed the crypto industry started facing more scrutiny, but there didn’t seem to be much concrete action at the time. However, by 2022 and 2023, regulatory pressure clearly intensified, posing challenges for many companies, including Binance.

Can you talk about the crypto industry’s explosion 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 crypto bear market when Bitcoin was priced around $3,100. Even though the market was at a low point, the events we organized still attracted a large number of participants. By 2021, the market experienced explosive growth, and the crypto industry reached new heights.

However, just a few months later, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Binance, accusing us of fraud, claiming we misused customer funds, and issuing an emergency freeze order to restrict all asset flows within the company. To help the company navigate this crisis, I provided a $250 million loan, which I only recovered after the case was fully dismissed.

Anthony: It’s clear that regulatory scrutiny on Binance intensified over time. Can you elaborate on what happened? I think many people only saw the headlines, but even I don’t fully understand the specifics. What were you accused of, and how did those allegations impact your business?

CZ: This incident occurred in November 2022. By December 2022, due to concerns about the safety of funds held by centralized exchanges, Binance experienced massive user withdrawals. Within a week, we processed approximately $14 billion in withdrawals, with the peak day being Wednesday, when withdrawal amounts reached $7 billion. That day, I was having dinner with some industry peers in Dubai, who remarked on Binance’s abundant resources, while I was internally reflecting on how I wasn’t directly involved in handling the withdrawals.

Despite the pressure, our systems operated stably, successfully processing 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 misusing user funds. During court proceedings, the judge clearly stated that the SEC had no substantive evidence. These details are documented and publicly accessible.

During the SEC 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. However, after the lawsuit, Binance U.S. lost its banking channels, and trading volume quickly dropped to about 1% of Coinbase’s. This had a significant impact on our business.

Subsequently, the U.S. Department of Justice (DOJ) also launched an investigation. Regarding the DOJ’s allegations, I reached a plea agreement, admitting to violating one provision of the Bank Secrecy Act. I can’t disclose more details, but the key point is that I became the first person in U.S. history to be imprisoned for a single violation of the Bank Secrecy Act, without any fraud or other criminal charges involved. This outcome surprised me greatly, but that’s how it unfolded. I voluntarily flew to the U.S. to address the matter, even though I thought the likelihood of such a result was low. Ultimately, it happened, and I spent four months in prison. Fortunately, everything was fine after I was released.

Binance and CZ’s Story

Anthony: I find your decision to voluntarily return to the U.S. particularly remarkable. Perhaps you believed the likelihood of imprisonment was low, but you still chose to face the charges. I imagine no one would advise you to evade the situation, but realistically, many people might choose to avoid it, right? They’d say, “I’m not going.” So, how did you make your decision during this process? Did you discuss it with friends or family, and what was your emotional state as everything unfolded?

CZ: It was an incredibly difficult process. It’s hard to put into words and make people fully understand its complexity. It was a psychological challenge beyond imagination. Throughout the process, I considered various options and listened to advice from friends and lawyers.

I had to weigh the consequences. If I chose to evade, I could become an international fugitive, and life would become extremely challenging. I’d have to be very cautious at border checks and might never be able to move freely again. Moreover, my career would suffer severely. More importantly, many of our users, especially those holding BNB, would incur losses. The price of BNB would likely plummet, and the entire crypto industry would be impacted—even Bitcoin’s price could drop. We’ve already seen the massive market impact caused by FTX’s collapse.

Although I could choose to live in a country without extradition treaties and lead a relatively stable life, that’s not the lifestyle I wanted. I didn’t want to live a life of evasion and hiding.

I had a certain level of trust in the U.S. judicial system. Despite the political pressure faced by the crypto industry, I believed the U.S. justice system was still relatively fair. So I thought, why not face it? Even in the worst-case scenario of imprisonment, the duration might not be too long. I believed the more likely outcome was house arrest for 6 to 12 months, which would at least keep me away from other prisoners and ensure personal safety.

Additionally, I had already resigned from my position at Binance, paid a hefty fine, and the company had paid an even larger fine. I felt these measures were sufficient. So, after careful consideration, I decided to face the issue, take responsibility, and not choose to evade.

Anthony: During this process, I heard you missed the birth of one of your children. Is that true?

CZ: No, I didn’t miss my child’s birth. My younger son was born in July 2023, and I flew to the U.S. in November 2023. However, I did miss a minor surgery for one of my other sons. When I flew to the U.S., the plea agreement hadn’t been finalized yet. The U.S. government wanted me to stay in the country and promised not to restrict my movements, allowing me to move freely within the U.S., but they didn’t want me to leave the country.

We argued about this. I paid $150 million in bail, and three friends mortgaged their properties as guarantees for me. I believed I should be allowed to leave the U.S. since I voluntarily came to plead guilty. It would be absurd to plead guilty but not appear in court. If someone didn’t want to come, they could simply refuse to plead guilty and fight the case.

Initially, the judge agreed that I could leave, but the government then filed an appeal. This type of appeal is very rare, and what’s more surprising is that the judge supported the government’s request, requiring me to stay in the U.S. I had originally brought only a small carry-on suitcase with a few clothes but later had to buy new clothing in the U.S. I also missed an important medical procedure for my older son.

My sentencing process was supposed to take only three months, but the government requested a delay on my birthday, and the court granted a three-month extension. I requested to leave the U.S., but the court denied it. As a result, I stayed in the U.S. for six months, away from my family, just waiting for sentencing. Afterward, I spent another four months in prison.

CZ's Prison Experience

Anthony: I think anyone with children and family would understand your situation. My goodness, if they come to the U.S. and can’t leave or face other issues, it’s truly concerning, isn’t it? I think that’s understandable. So you were sentenced. As I understand, you served four months in prison, correct? I also heard your first cellmate was a double homicide convict. Is that true?

CZ: Yes, it’s true.

What’s even more interesting is that before I went to prison, during the period between sentencing and incarceration, the government requested the judge to have me handcuffed and sent to prison. However, the judge denied this request because I had behaved well during my bail period, with no violations in six months, and the judge felt additional supervision was unnecessary.

After sentencing, I initially thought I’d be sent to a minimum-security prison because my crime was considered a white-collar offense. Theoretically, minimum-security prisons usually don’t have fences, the environment is more relaxed, and inmates can move freely as long as they don’t leave the premises. However, since I wasn’t a U.S. citizen, I was assigned to a low-security prison instead.

Low-security prisons primarily house drug offenders and other convicts. My first cellmate was a double homicide convict serving a 30-year sentence. He had already served 18 years and, due to good behavior, was downgraded from a medium-security prison to a low-security one. However, he could never enter a minimum-security prison.

Prisons group inmates by ethnicity to reduce conflicts. I was assigned to the Asian, Pacific Islander, and Native American group. Although my roommate was a double homicide convict, we got along quite well. He was actually very easygoing, but the most challenging part wasn’t his crime—it was his snoring at night. On the first night, I hesitated to wake him up, considering he was a double homicide convict, so I decided not to. The next morning, I politely told him, “Brother, your snoring is really loud.” He responded, “No problem, you can kick me awake.” So after that, I did, and we got along just fine.

Before I went to prison, Bloomberg and The Wall Street Journal reported that I might be the wealthiest person in U.S. prisons. These reports didn’t help me; instead, they made me worry about becoming a target for extortion. Fortunately, most people in prison don’t read these media outlets.

Anthony: Did you ever feel unsafe, or did anyone try to extort you?

CZ: Not really. I was somewhat concerned initially, but I quickly blended in with the people around me and joined a group. I adapted to the environment, didn’t show any vulnerabilities, and thus no one tried to extort me. While some people might try to negotiate better conditions in certain situations, I didn’t face any physical threats.

Anthony: I can imagine that if a very wealthy, successful person enters a low-security prison, others might ask you for advice on investments or cryptocurrencies. Did you ever discuss Bitcoin or other cryptocurrencies while in prison?

CZ: Soon, both inmates and guards knew about my identity, and some inmates showed interest in learning about cryptocurrencies and investments. We managed to get some cryptocurrency-related books sent to the prison. I formed a small study group with them, spending 30 minutes daily discussing investment knowledge. I assigned them homework, and they asked questions. The prison had nine TVs, one of which was switched to the financial news channel to track Bitcoin prices. This study group helped me build support and reduced potential troubles.

Additionally, some guards asked me whether it was a good time to buy Bitcoin. I usually replied, “I don’t have internet access here and can’t get market updates, so I can’t give advice.” While my friends sent me market updates via mail, I kept a low profile to avoid unnecessary attention.

Overall, the guards treated me fairly well. I didn’t encounter major violent incidents in prison, though occasional conflicts occurred, but none involved me. I think the U.S. prison system, at least the low-security prison I was in, is relatively safe.

Reflections on Pardons and Legal Battles

Anthony: We just mentioned the story of Marc Rich, and I find it fascinating that you read that book and treated it as a textbook to learn from. You also referenced the case of Mike Milken. Historically, there have been people who were accused, convicted, or even imprisoned and later pardoned. I noticed the current administration has pardoned some criminals, including drug offenders and white-collar criminals. Pardons are often a complex process, so have you considered applying for a pardon? What are your thoughts on pardons?

CZ: I certainly hope to receive a pardon, but frankly, I don’t know much about the process. For any convict, obtaining a pardon is obviously an ideal outcome, especially in my case, where I think some political factors might be involved. Five days before my sentencing, Senator Elizabeth Warren declared war on cryptocurrencies on national television and wrote an open letter to the Department of Justice. So whether politics played a role, I can’t be sure. Pardon applications are typically handled by lawyers, and I prefer not to comment further on this matter.

Anthony: What about the legal battles? How do you view the charges you faced? You’ve already pled guilty, but do you think there was an element of legal warfare during the investigation and prosecution?

CZ: I think in the SEC case, it’s quite clear there were signs of legal warfare. Our case has now been dismissed with prejudice, indicating that the new administration is more reasonable in regulating the market. I feel they’re starting to understand the complexities of new technologies and industries and are trying to strike a balance between encouraging innovation and protecting consumers.

We’ve indeed seen a shift in attitude. It’s not just my case; if you look at former President Trump, he’s clearly been a major target of legal warfare and political agendas. During my imprisonment, I heard that President Trump attended a Bitcoin conference in Nashville in July and publicly expressed support for cryptocurrencies. I also heard Vice President Kamala Harris expressed support for cryptocurrencies. This surprised me greatly because within two months of my imprisonment, the government’s attitude seemed to have shifted.

Additionally, I read about President Trump being criminally charged for taking some documents to the restroom. I find this somewhat extreme. If my employees did this, I might reward them for making good use of their time to read documents. This situation makes me feel that the definition of legal warfare is very subjective, especially in the context of the previous administration’s apparent hostility toward cryptocurrencies. Senator Elizabeth Warren repeatedly warned against cryptocurrencies, and Gary Gensler initiated multiple lawsuits. Now we see the new administration being more crypto-friendly and having a deeper understanding of finance and technology. So I think legal warfare might indeed exist, but the specifics are still very complex.