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Binance’s BNB crypto token surges after founder Zhao begins work as richest prisoner in US
The BNB token, a cryptocurrency linked to Binance and its jailed co-founder Changpeng Zhao, hit a record high in the first week of his four-month prison sentence in the United States.
His rally highlights Zhao’s status as the richest person to ever serve a federal prison sentence in the United States. Zhao reported to a California prison on Tuesday to begin a four-month sentence for failing to adequately safeguard the world’s largest cryptocurrency exchange from money laundering.
On Thursday, BNB price rose to a peak of $717.48, bringing its market capitalization to $109 billion, according to data from CoinGecko. The price of the token has more than doubled since the beginning of the year.
BNB’s trajectory also reflects the fortunes of Binance itself. The total value of assets on the stock market has risen from about $80 billion in early January to $125 billion today, solidifying its dominance even after a precarious period last year that culminated in the company paying a historic $4.3 billion fine to settle case. with the US authorities.
BNB holders get discounts on trading fees 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.
According to Kaiko analyst Dessislava Aubert, BNB’s recent rally was foreshadowed in derivatives market trading patterns starting in late May, with spot demand starting to recover in June and buying steadily exceeded sales between June 2 and 5.
BNB is traded on more than a dozen centralized exchanges, he said, “which differs from other exchange tokens that are traded almost exclusively on their affiliated platforms.” Binance still accounts for 85% of BNB volume globally, she added.
Binance has been accused of violating anti-money laundering and sanctions regulations, including failing to prevent Hamas, al-Qaeda and other militant groups from accessing the exchange. Zhao also agreed to pay a personal fine of $50 million to settle the charges.
This is a drop in the bucket of Zhao’s net worth, which is estimated to be $38.5 billion, although 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 “fair-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 $4.1 billion in 2024, according to the Bloomberg Billionaires Index.
While Zhao has never revealed exactly how much BNB he owns, a 2017 whitepaper related to BNB’s initial coin offering, or ICO, shows that 80 million tokens, now worth around $56 billion, were awarded to the founding team. The money raised through the ICO was used to launch the Binance exchange.