CZ's prison time: Financial jackpot or loss?

What Bloomberg and Forbes have to say

Author

Daniel Akpobare
October 02, 2024

GM Explorer,

Binance's Changpeng Zhao (CZ) spent months in prison—but did his net worth soar by billions or plummet? Forbes and Bloomberg can’t agree!

Here’s what we got for you today:

  • 🤷‍♀️ CZ's prison time: Financial jackpot or loss?

  • 👊 Middle East conflict shakes up the crypto market!

  • 🧱 Around The Block: Australia’s ‘Operation Kraken’ seizes $6.4 million in crypto linked to global crime.

🤷‍♀️ CZ's Prison Time: Financial Jackpot or Loss?

A few days ago, former Binance chief Changpeng Zhao’s four-month prison stay ended, and his first public comment made headlines.

Now, there are conflicting reports about how his net worth fared during his time behind bars; let’s dig into the details, shall we?

CZ's prison stay actually lasted 117 days, from June 2 to September 27, 2024.

And during that time, Forbes initially estimated CZ’s net worth at $57.8 billion on July 12, but by September 27, that estimate had grown to $61 billion.

That would mean that CZ gained at least $3 billion, which breaks down to $25 million per day in personal net worth for every day he served in prison.

However, you must remember that Forbes does not disclose its methodology.

Bloomberg, on the other hand, offers a very different view!

They claim that CZ lost billions while behind bars, with his net worth dropping from $36.5 billion on June 2 to $30.8 billion by September 27.

These figures were arrived at by valuing CZ's holdings of BTC, BNB, and Binance.us at $0.

Additionally, they discounted the value of his Binance.com equity by 50% based on the average EV-to-sales multiple of three peers: Coinbase Global Inc., Galaxy Digital Holdings Ltd, and Riot Platforms Inc.

However, Bloomberg's confidence in these estimates is at the lowest possible level—just one out of five.

The challenge in determining CZ's net worth is that most of his wealth is tied up in equity in privately held Binance-affiliated companies.

While CZ has disclosed holdings of crypto assets BTC and BNB, he is not obligated to publicly report his other assets from the Binance-affiliated companies.

So, until CZ spills the beans on his entire portfolio, we might never get the full picture.

👊 Middle East Conflict Shakes Up The Crypto Market!

It's the start of a new month, and Bitcoin is already having a rough time.

On Oct. 1, the cryptocurrency took a tumble, crashing alongside the stock market as tensions in the Middle East flared up.

Israel decided to kick off ground operations in Lebanon, which led to Iran responding by firing rockets at Israel, and more missiles are reportedly on the way.

Naturally, the crypto markets didn’t take this well.

A staggering $489 million was liquidated in just 24 hours, but the worst part is that $312 million of that vanished in just four hours.

Bitcoin, the usual king of crypto, dropped by 3% to $61,598!

But Bitcoin is not the only one feeling the pain—Ethereum, Solana, and the altcoin gang are hurting even more.

Ethereum is down 4.31%, Solana dropped 5.51%, and Dogecoin… well, poor DOGE plunged by 7.3%!

Meanwhile, the Fear and Greed Index, which tracks how brave (or scared) crypto investors are feeling, nosedived from a "greed zone" at 61 point to a cautious 50 in just a day.

So, it’s safe to say the mood isn’t exactly party time in crypto land.

On the traditional market side, US stocks also joined the pity party. The S&P 500 slid 1.1%, and the Nasdaq fell 1.85%.

Even tech giants like Nvidia and Apple felt the heat, with Nvidia shares falling 4% and Apple shares dropping 3.6%.

But while everything else felt the pressure, gold and the dollar stood strong –not only did the dollar gain 0.6%, but gold also climbed by 1.1%.

However, as Jeroen Blokland (the founder of the Blokland Smart Multi-Asset Fund) said in a post, Bitcoin has a track record of bouncing back during global crises.

Remember the US-Iran conflict in 2020? Or when Russia invaded Ukraine in 2022? Even the U.S. banking crisis in 2023? Bitcoin outperformed both stocks and gold, then.

So, maybe it’s not time to panic-sell your BTC just yet— that's if history is anything to go by.🤞

If you want to dive deeper, you can find out more here!

🧱 Around The Block

That's all we've got for you today.

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell assets or make financial decisions.

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