Can Zhao Changpeng’s release from prison trigger the next crypto bull market?

Author: Bitke Editor: Daheilong

If nothing unexpected happens, the former richest Chinese Zhao Changpeng will be released from prison on September 29, local time in the United States.

According to the Securities Times, the reporter confirmed the news from the Federal Bureau of Prisons. The official website of the Federal Bureau of Prisons shows that Zhao Changpeng's current location has been updated to the Long Beach Residential Reentry Management (RRM) in central California, which means that he is undergoing preparation and assessment before returning to society, which is likely to be the last procedure before returning to society.

So, can this cryptocurrency tycoon who is about to be released from prison trigger the next bull market?

Background of Zhao Changpeng: A cryptocurrency tycoon from Lianyungang

Born in Lianyungang, Jiangsu, Zhao Changpeng is a Chinese-Canadian entrepreneur. A brief summary of his development and imprisonment timeline is as follows:

In 2017, Zhao Changpeng founded Binance, which quickly became a global cryptocurrency exchange, providing trading platforms for more than 150 cryptocurrencies.

At the end of 2021, with the surge in Bitcoin and many other cryptocurrencies, Zhao Changpeng was ranked the richest Chinese with a net worth of US$94.1 billion (approximately RMB 634.8 billion).

In November 2023, officials from the U.S. Department of Justice stated that Binance, which operates the world's largest cryptocurrency exchange Binance.com, admitted to participating in suspected money laundering, unlicensed remittances, and sanctions violations, and agreed to pay a fine of approximately US$4.3 billion; at the same time, Binance founder and CEO (CEO) Zhao Changpeng admitted that he had failed to maintain an effective anti-money laundering program and had resigned as CEO of Binance. In the end, Zhao Changpeng and Binance pleaded guilty.

In April 2024, a U.S. District Judge in Seattle sentenced Zhao Changpeng to four months in prison for failing to implement an effective anti-money laundering framework, which allowed Binance to become a viable platform for cybercrime and terrorist activities. The sentence was far lower than the three-year prison sentence recommended by prosecutors, but it was still not the result expected by Zhao Changpeng's defense lawyers, who appealed for probation. According to the Forbes rankings, as of April 2024, Zhao Changpeng still has a wealth of more than $30 billion.

The former richest Chinese, Zhao Changpeng, is about to be released from prison. Can he trigger the next bull market?

As the founder of Binance, Zhao Changpeng's personal destiny is closely related to the cryptocurrency market. The news that he is about to be released from prison will undoubtedly stir up waves in the market. To deeply analyze the impact of this incident on the cryptocurrency market, we need to consider it from the following perspectives:

First, Zhao Changpeng's release from prison means that the crisis at the personal level has come to an end for the time being. This will help restore his positive image in the minds of investors and enhance the market's confidence in Binance and its ecosystem. As the helmsman of Binance, Zhao Changpeng's return is expected to stabilize the turbulence in the cryptocurrency market and ease the market's concerns about the stability of the platform. On the other hand, Zhao Changpeng has considerable influence in the cryptocurrency industry, and his return is expected to boost the morale of the entire industry and attract more investors to enter the market.

The market shows that during Zhao Changpeng's imprisonment, Bitcoin fluctuated by more than 2 US dollars. In April this year, when Zhao Changpeng was imprisoned, Bitcoin reached $71,000, then entered a sharp fluctuation and once fell below $50,000. The latest price is $63,192.

Secondly, Binance's strategic adjustment is also very important. In order to cope with regulatory pressure, Binance may accelerate the pace of global layout and regulatory compliance. This will help enhance the confidence of institutional investors and promote the maturity of the cryptocurrency market. With the further improvement of regulatory compliance, Binance may accelerate the launch of new products and services, provide users with more choices, and further expand its market share. In the foreseeable future, Binance may increase its investment in ecological construction, attract more projects and developers to join, and thus build a more prosperous cryptocurrency ecosystem.

From the perspective of the market's macro fundamentals, the cryptocurrency market is greatly affected by the macroeconomic environment. If the global economic situation improves, it will be conducive to the strengthening of risky assets, and the cryptocurrency market will also benefit from it. The regulatory policies of various countries on cryptocurrencies are an important factor affecting market trends. If the regulatory policies become clearer, it will be conducive to the stable development of the market. Technological innovation in cryptocurrencies is the core driving force for market development. New technological breakthroughs will bring new growth points to the market.

Of course, there may be some potential risks when Zhao Changpeng is released from prison, such as the possibility of excessive market speculation on Binance, resulting in sharp price fluctuations in the short term. In addition, although Binance is actively promoting compliance, it still faces regulatory risks from all over the world. The cryptocurrency market is highly competitive, and Binance's competitors may take the opportunity to expand their market share.

Summary

On the whole, the impact of Zhao Changpeng's release from prison on the cryptocurrency market is multifaceted, with both positive and potential risks. In the short term, the boost in market sentiment may drive up the prices of Binance and its related tokens. In the long term, factors such as Binance's strategic adjustments, the macroeconomic environment, regulatory policies, and technological innovation will jointly determine the development trend of the cryptocurrency market. Investors should take the above factors into consideration when making investment decisions and pay attention to risk control.