Changpeng Zhao brings Binance to the top of the crypto market
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In July 2017, Changpeng Zhao, more commonly known by his nickname CZ, created the Binance cryptocurrency exchange. He was the former technical director at OKCoin, the 2nd largest cryptocurrency exchange globally.
After just over four years, Changpeng Zhao has built a cryptocurrency exchange with a value of nearly 300 billion USD.
Changpeng Zhao founded Binance in 2007. In an initial coin offering (ICO) to fund his exchange, Zhao raised $15 million. Just six months later, Binance became the number one exchange globally with about 6 million registered users.
Binance has attracted many customers from other exchanges to switch over with lower transaction fees compared to the common ground. The early construction of its decentralized finance (Defi) ecosystem since 2018 helps Binance attract a large amount of investment capital and many talented engineers to contribute.
Years of experience in the financial sector
Zhao immigrated to Canada at the age of 12. After graduating from McGill University with a degree in information technology, he started his first job at the Tokyo Stock Exchange.
“I realized early on how money flows through this computer system. From that moment on, I never took my eyes off the financial sector,” Zhao said in an interview with Bloomberg. The time working in Japan helped Zhao a lot in the later period.
After leaving Tokyo, Zhao applied for a job at Bloomberg LP, the financial subsidiary of Bloomberg. Zhao’s career at Bloomberg is focused on developing a system to manage trade orders in multiple markets. This position helps him understand how data impacts investors’ decision-making.
In 2013, Zhao first read the Bitcoin white paper. At this point, he realized that cryptocurrency was a place where he could use the financial market experience he had accumulated to build his career.
The initial success of Binance is not only because he raised capital at the best time of the market in 2017. The low transaction costs thanks to the use of the BNB cryptocurrency issued by this exchange are why people flock to use Binance.
Binance provides more than 350 cryptocurrencies. This number is double the number of Coinbase, the leading cryptocurrency exchange in the US.
How Binance Creates an Advantage
One of the reasons Binance is as successful as today is that this broker eliminates the procedures for customers to enter the market.
Binance allows customers to open accounts using just email. However, customers still need to verify their identity to remove the withdrawal limit.
Binance’s acquisition of the data platform CoinMarketCap in 2020 shows Zhao’s move in controlling information. The merger of this data company gives Binance a complete grasp of the cryptocurrency market.
Zhao also recognized the weaknesses of the Ethereum ecosystem. Ethereum is slow to change, high transaction costs and long execution times make people look for other blockchain networks. Zhao seized this opportunity early on by building the Binance network into a Defi ecosystem since 2018.
While not wholly decentralized as a criterion of the blockchain sector, transaction execution on the Binance ecosystem is faster than Ethereum. The cost of executing a transaction on the Binance chain is just $0.4 compared to an average of $12 on the Ether network.
Low fees are a factor that makes users prefer trading on Binance over other exchanges.
Thanks to being a complete ecosystem, Binance is often the choice of many project founders. Binance’s token launchpad platform fully supports the project if they issue tokens on this ecosystem. Projects released through Binance Launchpad are a guarantee of a quality project.
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