Binance Coin (BNB), the native token of the world’s largest crypto exchange Binance, recently hit an all-time high of $725 on June 6th, the first week of exchange founder Chagpeng Zhao’s (CZ) four-month prison sentence in the US.
According to a Bloomberg report, this price rally for the Binance Coin has made CZ the richest person ever to serve time in a US federal prison. Despite his legal troubles, the token’s market capitalization surpassed $109 billion in the past week, based on data from CoinGecko.
BNB’s Price Surge Mirrors Exchange’s Rise?
Per the report, Binance Coin’s price trajectory mirrors the fortunes of the exchange itself, as the total value of assets on the platform has climbed from approximately $80 billion in early January to $125 billion currently.
This growth has further solidified Binance’s dominance in the cryptocurrency industry despite a challenging period last year that culminated in the company paying a historic $4.3 billion fine to settle a case with US authorities.
BNB holders benefit from trading-fee discounts on the Binance platform. The token is also utilized for fee settlements on Binance Smart Chain, a blockchain widely used by crypto applications, including games and exchanges.
The recent surge in BNB’s value was foreshadowed by derivative market trading patterns in late May, followed by increased spot demand in June, as buying consistently outpaced selling between June 2 and 5, as Kaiko analyst Dessislava Aubert noted.
While BNB trades on several centralized exchanges, Bloomberg notes that Binance remains the dominant platform, accounting for 85% of BNB’s trading volume globally.
Binance Founder CZ’s Wealth Surpasses $38 Billion
As previously reported, Binance had faced allegations of anti-money laundering (AML) and sanctions breaches, including failing to prevent access to the exchange by groups such as Hamas, Al Qaeda, and other militant organizations. Zhao agreed to pay a personal fine of $50 million as part of the settlement.
However, this amount is relatively small compared to Zhao’s estimated net worth of $38.5 billion, a fortune primarily denominated in BNB. Zhao has previously stated that he is a significant shareholder in Binance.
Referred to as “CZ,” Zhao currently ranks as the 40th wealthiest person globally, with his net worth having grown by $4.1 billion in 2024, according to the Bloomberg Billionaires Index.
While the extent of Zhao’s BNB holdings remains undisclosed, a 2017 whitepaper from BNB’s initial coin offering (ICO) revealed that 80 million tokens, valued at approximately $56 billion today, were allocated to the founding team.
Overall, despite the legal and regulatory challenges faced by Binance and its co-founder, the surge in the value of BNB highlights the continued interest and confidence in the token and its associated ecosystem.
At the time of writing, BNB was trading at $652, down 4% in the last 24 hours. However, on a year-to-date basis, the token is up a substantial 176%.
Featured image from DALL-E, chart from TradingView.com