CZ Earned $25M Daily in Prison, Report Claims on Binance Founder

Changpeng Zhao, the former chief of Binance, may have turned his four-month prison term into a surprisingly profitable career decision. From the moment he entered a California correctional facility this summer until his recent release, the Binance founder likely earned more than most executives could anticipate over a lifetime.

While his primary wealth stems from equity in privately owned companies, Forbes’ estimates of CZ’s net worth suggest he potentially accumulated billions of dollars personally while incarcerated. In fact, one estimate posits that he could have gained $25 million for each day he was imprisoned.

Nonetheless, it’s crucial to mention that Bloomberg, using a more measured approach, argues that CZ actually incurred losses during his time in prison.

Further analysis on these estimates is provided below.

Establishing the dates of CZ’s incarceration

In November 2023, CZ pleaded guilty to intentional breaches of the Bank Secrecy Act that facilitated money laundering through Binance.com. As a consequence, he consented to step down as CEO, pay a $50 million penalty, and refrain from publicly contesting the Statement of Facts from the U.S. government’s lawsuit against Binance.

The judge subsequently recommended that CZ serve his time at the Seattle-area prison, Seatac. However, for almost five weeks, post-sentencing legal processes delayed his entry.

Ultimately, the Bureau of Prisons admitted him to Lompoc II, a minimum-security facility located near Santa Barbara, on June 2, 2024.

Upon entering prison, the probation department scheduled his release for September 29. However, since this date fell on a weekend, he officially exited the Long Beach halfway house two days earlier than planned. On his release day, he tweeted a customary crypto greeting.

In summary, CZ spent a total of 117 days in prison, from June 2 to September 27, 2024. Since he paid his $50 million personal fine prior to entering prison, this amount is not included in the assessment of any changes to his net worth during his incarceration.

Read more: New CZ lawsuit will ‘put blockchain analytics on trial,’ says lawyer

CZ’s 117-day change in net worth 

With the exact dates now established, the next step is to evaluate CZ’s change in net worth.

While CZ has revealed holdings in crypto assets like BTC and BNB, the majority of his wealth is tied up in equity within Binance-related enterprises. Unfortunately, due to the private nature of these companies and CZ’s lack of obligation to publicly disclose asset details, accurately determining his net worth presents substantial challenges.

In reality, only CZ is aware of his true net worth.

Nonetheless, Bloomberg and Forbes have both attempted to assess CZ’s wealth. Unfortunately, Forbes does not clarify its estimation methods.

Bloomberg, to its credit, assigns its confidence the lowest possible rating (one out of five). It values CZ’s crypto holdings of BTC, BNB, and Binance.us at $0 and places a 50% discount on the valuation of his equity in Binance.com based on the average EV-to-sales multiples of three comparative firms: Coinbase Global Inc, Galaxy Digital Holdings Ltd, and Riot Platforms Inc.

On June 2, Bloomberg’s estimate of CZ’s net worth stood at $36.5 billion. However, by September 27, it had dropped to $30.8 billion. Bloomberg analysts thus conjecture that CZ suffered a financial loss during his imprisonment.

In contrast, consider Forbes’ opposing estimation.

Forbes strongly disagrees with Bloomberg

On September 27, Forbes placed CZ’s net worth at $61 billion — nearly twice Bloomberg’s estimate from that same date. This likely reflects Forbes’ positive estimates for CZ’s crypto holdings and a more conservative discount applied to his equity in Binance.us and Binance.com.

Regrettably, Archive.org’s WayBack Machine did not capture Forbes’ estimate on the date of CZ’s entry into prison on June 2. The next available snapshot from May 7 shows his wealth at $33 billion. By the subsequent snapshot from July 12, this figure had surged to approximately $57.8 billion.

Even if we assume the higher figure for CZ’s net worth as of June 2, Forbes implies that his wealth grew by at least $3 billion by the time he was released. It is reasonable to suspect that Forbes calculated CZ’s net worth gained at least from below $58 billion to $61 billion during his incarceration.

If this holds true, it would imply that CZ accrued $25 million per day in personal net worth for each day he was imprisoned.

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