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SEC Lawsuits Impact Net Worth of Coinbase and Binance CEOs

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SEC vs. Binance
SEC vs. Binance

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The recent SEC lawsuits against crypto exchanges Coinbase and Binance dealt a heavy blow to the overall activities on the platforms. Also, the cases have negatively impacted the exchanges’ CEOs’ net worth.

Net Worth of Binance And Coinbase CEOs Drop

The United States Securities and Exchange Commission (SEC) extended its hunt against crypto firms with lawsuits. The regulator sued the Binance and Coinbase crypto exchanges on June 5 and 6, respectively. 

Following the lawsuits, data from Bloomberg Billionaire Index and Forbes reveal a drop in the net worth of Changpeng Zhao and Brian Armstrong, the CEOs of Binance and Coinbase, respectively.

According to Bloomberg’s data, Zhao, the richest person in the crypto, suffered a decline of 5.1% in his net worth. Binance CEO, popularly known as CZ, lost $1.33 billion, causing his net worth to crash to $26 billion this week.

In April 2023, Binance’s blog highlighted that Zhao’s net worth was around $28.2 billion. 

Also, it noted that CZ ranked third among individuals that made wealth via computer-driven trading firms in Bloomberg’s ranking of financial giants. Bloomberg’s analysis indicated that CZ’s net worth rebounded more than 106% this year. 

However, there’s still a drop of over 73% from Zhao’s peak net worth of $96.9 billion as of January 2022. Bloomberg Billion Index ranks Binance’s CEO as the 54th richest person globally. 

Similarly, the CEO of Coinbase, the largest crypto exchange in the US, Brian Armstrong, has witnessed a drop in his net worth. His net worth dipped by 11.8%, representing about $289 million, following SEC’s lawsuit against Coinbase.

Armstrong’s net worth sits at $2.2 billion, with the CEO ranked as the 1,368 richest person by Forbes. The yearly wealth trend for Armstrong indicated that he experienced the worst impact from the SEC’s lawsuit. 

Before the recent outcome, Armstrong had witnessed up to 61% reward during the market rebound early this year. 

SEC Crackdown On Binance And Coinbase

The SEC resumed its enforcement actions on crypto, cracking down on Binance and Coinbase operations this week with lawsuits.

The regulator charged the exchanges for violating US securities laws in its complaint. It alleged that the exchanges offer crypto assets and securities according to SEC’s classification. 

Also, it charged the firms for operating as securities brokers without the necessary registration and license. In its filing documents against Binance and Coinbase, the SEC has cited about 67 crypto assets as securities. 

These include Binance USD (BUSD), BNB, Cardano (ADA), Solana (SOL), Cosmos (ATOM), Polygon (MATIC), and Sandbox (SAND). Others are Internet Computer (ICP), Infinity (AXS), Chiliz (CHZ), Decetraland (MANA), COTI, Nexo (NEXO), etc.

Binance has criticized SEC’s lawsuit and regulatory approach to cryptocurrency. It vowed to fight the case to the peak of legal extent.

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