Note: On April 24, the U.S. Department of Justice said that Binance founder and former CEO Zhao Changpeng should serve three years (36 months) in prison. According to the reasons given, the U.S. Department of Justice lawyers believe that Zhao Changpeng helped Binance violate federal sanctions and money laundering laws, and said that he must pay a greater price, so the sentence should be increased.
Just before the trial, CZ apologized for his "wrong decision" in a letter to Richard A. Jones, the judge in charge of the case, and admitted that he needed to take full responsibility for his actions.
In addition to CZ's apology letter, there are 161 letters of support from his family, friends and others, which restore the real CZ Zhao Changpeng from different angles. CZ's sister, Jessica Zhao, a former managing director of Morgan, said that although her brother made mistakes, he worked hard to help others in his life. At the same time, she mentioned the FTX incident and emphasized that CZ ensured that Binance never misused any customer funds. Zhao Changpeng's children, Ryan and Rachel, who are studying at American universities, hope that the judge should not define Zhao Changpeng's character solely through this incident.
Among them, the most special letter came from He Yi, co-founder of Binance and mother of three children. She wrote in the letter:
"If the cryptocurrency industry is compared to the Wild West, then CZ is the guardian of this wilderness."
"For CZ, whether poor or rich, he takes charity seriously and assumes social responsibility because he is kind and has a humanitarian spirit."
Finally, He Yi said, "Today, it is a sense of responsibility that made him choose to face the trial, but he should never be regarded as the same as those evil murderers, robbers, and fraudsters. I sincerely hope that Judge Jones can open the eyes of God, be omniscient and omnipotent, and make a fair judgment after seeing a more complete CZ."
The following is the full text of He Yi's letter:
Dear Judge Jones:
In the spring of 2014, I met Changpeng Zhao at a school blockchain public event. Everyone called him CZ. Unlike the anonymous name used by many people, this is the initials of his real name. CZ was immediately invited to the stage to share impromptu that day because the organizer found that he worked for the most popular Bitcoin wallet at the time (blockchain.info). He enthusiastically explained blockchain technology and Bitcoin principles to everyone. At that time, he had just sold his house to buy Bitcoin. Due to the decline in the price of Bitcoin, his assets shrank significantly, but this did not hit his obsession with blockchain technology. His speech was full of idealism about how blockchain technology can bring positive changes to the world, which also greatly influenced and inspired me. Later, CZ chose to get involved in the encryption field and founded Binance. Of course, he hopes that the company will succeed, but he is not a person who takes making money as the ultimate goal. He sincerely hopes to use technology to promote the progress of the world.
In the summer of 2014, CZ’s years of experience in matchmaking and trading technology could not be fully utilized in Blockchain. After I invited him many times, he joined OKCoin, the crypto trading platform where I worked. At that time, the cryptocurrency industry had entered a downward cycle. Amid the industry’s wailing, a community member unfortunately suffered from leukemia. He could not afford his medical expenses, so he publicly launched a fundraising campaign. CZ actively participated in the donation even though his personal assets had shrunk greatly, but unfortunately, this community member still died in the end. Inspired by this incident, CZ and I jointly launched the "Love BTC" charity project. He built a website and a public Bitcoin wallet address. We raised funds through social media auctions of clothing, etc., and then directly exchanged BTC for goods and gave them to the beneficiaries. For this purpose, CZ also wrote a paper on how blockchain technology can achieve 100% transparent charity, ensure that the final beneficiaries receive 100% of the benefits, and ensure that no donations are eroded by the middleman's management fees. This paper can be found on Github with a timestamp of April 2014
(https://github.com/cpzhao/bitcoin_charity/blob/master/Bitcoin_Charity.md), and this is the predecessor of Binance Charity.
This was three years before Binance was founded, and CZ was not rich at the time. Many people think that charity is just a way to gain fame and reputation. Some people use it as a means to offset taxes, and some people say that they will do charity when they are financially free.For CZ, whether he is poor or rich, he takes charity seriously and assumes social responsibility because he is kind and has a humanitarian spirit.
In August 2017, the first month I joined Binance, a young user came to me and said that he had transferred thousands of dollars to Binance’s wallet address, but Binance did not support this token, so Binance could not receive the token; this was a common mistake in the early days of the industry.
According to the industry practice at the time, one has to take responsibility for one's own mistakes. However, for this kid in his early 20s, the few thousand dollars might be his family's annual income, his annual college tuition, and his hope for the future. After a brief discussion between me and CZ, he mobilized our limited development resources and quickly helped the user recover the assets. This was the first case in the industry to help users recover assets from the wrong address. With the first time, there will be countless times later. Under CZ's guidance, Binance has helped more than 180,000 users recover assets with a total value of more than 441 million US dollars. This is a project that consumes a lot of resources and is not worth doing in terms of ROI, but we can ignite hope for our users in despair. To this day, publicly listed trading platforms such as Coinbase still do not support this service. In this emerging Wild West, countless practitioners play the role of predators, and CZ has always insisted that we should do the right thing: protect users.
In early 2018, the price of Bitcoin rose to more than $20,000, and investors' enthusiasm also spawned a large number of frauds. One day, a group of Chinese users came to me and pointed out that they were lured by an account on social media to invest in a project. After transferring the money, the person disappeared, but according to the public on-chain information tracking, the money had just been transferred to Binance. According to the law enforcement process of most platforms today, users need to find the police first and the police provide a letter of cooperation before freezing. At that time, China banned cryptocurrency transactions, and the Chinese police did not handle such cases. CZ said to us: "Do the right thing." We temporarily froze the stolen money, and then organized multiple calls between the victims and the scammers. In the end, the scammers returned the money to the users, and the scammers also closed their accounts. This is just one of countless examples of CZ's persistence in cracking down on evildoers. In the past 2023, Binance cooperated with law enforcement agencies in various countries in more than 58,000 case investigations, many of which were initiated by Binance to promote law enforcement agencies. This is why even though the mainstream media tries to portray CZ as an evil villain, millions of community users and ordinary people regard him as a hero in the industry, because CZ has always insisted on justice. If the cryptocurrency industry is compared to the Wild West, then CZ is the guardian of this wilderness.
Since 2019, the company's staff has begun to grow rapidly, and the team composition is very global and full of diversity. During this period, there are Wall Street elites who graduated from Ivy League schools, dropouts from Europe, female NGO fighters active on the front line in Africa, and young men in rural Southeast Asia who do not want to be fishermen. It can be said that CZ really treats everyone equally regardless of race, belief, gender, education, and family background. Whether it is a junior employee's house in Southeast Asia destroyed by a fire, or Covid sweeping the world causing employees to lack epidemic prevention supplies, or even the war between Russia and Ukraine posing a danger to employees, CZ helps employees regardless of the cost. For a boss of a company, it is not uncommon to spend millions of dollars to help those scarce talents facing difficulties lead their families away from an unstable living environment and continue to pay allowances. When CZ decided these, he did not consider their background and rank, which also covered a large number of junior employees who were just starting out. These employees are generally easy to find replacements, but CZ made decisions for only one reason: they need support.
CZ's leadership style may not conform to traditional expectations of a good CEO. His commitment to transparency and fairness at Binance often conflicts with the power expectations of a small group of employees accustomed to an elite corporate environment. This has led some employees to leave the company with resentment and make false accusations to the media. Although these reports sometimes frustrate me, CZ has always shouldered this burden and continued to support fairness and equality because he understands that true fairness is sometimes unfair to the privileged few.
One weekend in November 2022, FTX was in crisis, and Sam (SBF)'s last call for help was to CZ. Before getting any valid reports and documents provided by SBF, CZ convened a management meeting to decide whether to rescue FTX. He said: "We don't need FTX as a company. We save FTX to save the industry. We should save FTX." Although he was reluctant to give up the deal in the end, the subsequent public information of the incident showed that multiple companies associated with FTX were misappropriating user assets, which made CZ dumbfounded. CZ believes that transparency is a better solution, so he made Binance's trading platform wallet address public, and launched a product that allows users to check their account funds and online wallet addresses to demonstrate Binance's transparency, which further promotes industry self-discipline.
So far, CZ and I have experienced ten years of ups and downs in this industry. These ten years have been a decade of dramatic changes in the industry. In these ten years, Bitcoin has risen from a low of hundreds of dollars to more than 40,000 US dollars now. We have seen countless former celebrities lose their reputations and countless well-known institutions collapse in an instant. Most of the time, these people are self-proclaimed smart. They are talented, but they regard the law as nothing, thinking that they can deceive the public or get away with legal sanctions, but CZ is not: he is upright, kind, sincere, smart and very, very hardworking; CZ underwent two spinal surgeries in 2020 alone due to work reasons, and he did not stop working for a day even if he was repeatedly lying in bed for 18 months. In the past six years, as CEO and the largest shareholder, he received a salary lower than that of multiple executives subsequently introduced by the company, and did not make a single dividend or cash out for himself. This time, in order to keep Binance running, he chose to fly to the United States to plead guilty; between personal interests and public interests, CZ always chooses to sacrifice himself to achieve Binance, and between Binance and users, he will choose users.
As CZ's partner, I clearly know how CZ won the respect of the community; it may be that when the Chinese government banned Bitcoin trading platforms, other project parties took the opportunity to make a fortune, and CZ chose to clear users at a higher price: it may also be that Binance was stolen, and CZ was the first to disclose the information and take full responsibility, and it may be that when countless project parties issued coins just to sell coins to get rich, CZ was helping users track down scammers and hackers in the industry, and some cases were even unrelated to Binance, just because of his sense of mission and responsibility for the industry.
As CZ's life partner, I have known CZ for nearly ten years, so I know his unknown side better. He knows nothing about the jewelry, luxury goods, luxury cars, and art auctions that the rich are keen on. He lives a simple life. He buys affordable clothes on Amazon, rides a balance bike to meetings, and is publicly ridiculed by reporters for enthusiastically showing his Toyota 6-seater van to reporters. He buys things out of efficiency and interest. He has no fanatical desire for money, fame, and enjoyment. He hopes to live a meaningful life.
At the same time, he always tries to take care of his friends' feelings as much as possible, regardless of their occupations and social status: he also tries his best to take time out of his busy work to maintain high-quality interactions with his three young children. The children are very close to him, and now they are always asking: Why is Dad not at home? When can Dad come back?
Of course, I am not saying that CZ has not made mistakes here, but his biggest mistake is ignorance. As a startup without a fancy background, the founding team members have no legal background, and even most of the early management team members, except CZ, can't even read English, such as myself. In the absence of experience and legal knowledge, CZ won users with fairness, integrity and sense of responsibility to the industry, but also made mistakes. In any case, the mistakes have been made, and Binance and CZ have paid a huge price.
CZ once said: "No one wants to be a hero, because no one is born to rush to the front and block arrows. Heroes are just in that position to protect their families, communities, ethnic groups, and homelands to do the right thing, and have to become heroes in the process."
I humbly hope that Judge Jones will comprehensively consider that in the early and chaotic cryptocurrency industry, even how to regulate this industry and how to define the United States have not been determined. As a founder who has never managed a company of this scale, he will definitely encounter blind spots. If CZ knew the severity of the matter, he would definitely guard against it from day one and block any American users. He doesn't want to be a hero, and certainly doesn't want to be a criminal. All his actions follow the universal humanitarian principles and he does his best.
Today, it is his sense of responsibility that makes him choose to face the trial, but he should never be regarded as the same as those evil murderers, robbers, and fraudsters. I sincerely hope that Judge Jones can open God's eyes, be omniscient, and make a fair judgment after seeing a more complete CZ. If necessary, you can contact me at any time for more details.
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