Who is Binance owner Changpeng Zhao?
BINANCE is one of the biggest operators in the fast-emerging crypto market, offering a wide range of services to customers around the world.
Its British entity – Binance Markets Limited – was established in 2020 as part of a plan by the broader group to launch a UK-focused exchange, but the country's financial watchdog has ordered Binance to end ALL activities.
Who is Binance owner Changpeng Zhao?
Binance was founded by its CEO Changpeng Zhao, a Chinese-Canadian developer commonly referred to as CZ who had previously created high frequency trading software.
Zhao started working for the Tokyo Stock Exchange developing software for matching trade orders after leaving college before joining Bloomberg Tradebook.
He moved to Shanghai in 2005 and founded Fusion System, a trading system for brokers.
Since 2013, the 45-year-old has worked on a number of cryptocurrency projects, including OKCoin, where he left in 2017.
When was Binance founded?
Cryptocurrency exchange Binance was founded by Zhao after he left OKCoin in 2017.
Within eight months, Zhao grew Binance into the world's largest cryptocurrency exchange by trading volume.
Binance was initially based in China, but later moved its headquarters out of China due to its increasing regulation of cryptocurrency.
In October 2020, a leaked document was published by Forbes, alleging Binance and Zhao had created an elaborate corporate structure designed to intentionally deceive US regulators and profit from the country's crypto investors.
Then in May 2021, it was reported the company was being investigated by the IRS and US Justice Department on allegations of tax offenses and money laundering.
In June 2021, the UK's financial watchdog has ordered cryptocurrency exchange Binance to end all activities.
The intervention came as one of the most significant moves by any global regulator against the digital asset firm with subsidiaries around the world.
In a notice dated June 25, the Financial Conduct Authority (FCA) said Binance Markets Ltd, "must not, without the prior written consent of the FCA, carry out any regulated activities, with immediate effect".
5 risks of crypto investments
BELOW we round up five risks of investing in cryptocurrencies.
- Consumer protection: Some investments advertising high returns based on cryptoassets may not be subject to regulation beyond anti-money laundering requirements.
- Price volatility: Significant price volatility in cryptoassets, combined with the inherent difficulties of valuing cryptoassets reliably, places consumers at a high risk of losses.
- Product complexity: The complexity of some products and services relating to cryptoassets can make it hard for consumers to understand the risks. There is no guarantee that cryptoassets can be converted back into cash. Converting a cryptoasset back to cash depends on demand and supply existing in the market.
- Charges and fees: Consumers should consider the impact of fees and charges on their investment which may be more than those for regulated investment products.
- Marketing materials: Firms may overstate the returns of products or understate the risks involved.
They added: “The FCA has told Binance that by June 30 it must display a notice stating "Binance Markets limited is not perimtted to undertake any regulated acitivity in the UK" or on its website and social media channels.
The company must also now preserve information relating to UK consumers and inform that the FCA this has been done by July 2, 2021.
The intervention comes as a sign of how regulators are cracking down on the cryptocurrency industry over concerns relating to its potential role in illegal activities such as money laundering and fraud.
As a result, the FCA also issued a consumer warning this weekend against both the Cayman Islands-registered Binance holdings company and London based Binance Markets Limited.
The entity had since applied to become a registered cryptocurrency company with the regulator, but pulled that application last month.
What is Changpeng Zhao's net worth?
In February 2018, Forbes Magazine placed Zhao third on their list of The Richest People In Cryptocurrency.
As of April 2021, Zhao's net worth stands at $1.9billion (£1.37billion).
According to Forbes, Binance is the largest crypto exchange in the world, with $500million in daily trading volume as of early 2019.
It claims to have 25 per cent market share.
Zhao, as of June 2021, is fifth on Forbes' Crypto Rich List.
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