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Changpeng "CZ" Zhao, CEO of Binance, has responded to critics and conspiracy theorists who allege Binance is a Chinese-based "criminal business" that "secretly [belongs] in the pocket of the Chinese government."
CZ's reaction to criticism came in the form of a blog post published on Thursday by Binance, and derives from a Twitter spat with a former Washington Post journalist who questioned him, "While I have you here, who's Guangying Chen?"
He added that the query is in response to a conspiracy theory that claims his personal buddy and Chinese national Guangying Chen is the secret owner of Bijie Tech (a firm he formed in 2015) and perhaps Binance.
CZ, on the other hand, explains that Chen is a colleague he met through a friend and hired to "manage the back office" at Bijie Tech before re-hiring her at Binance, adding that conspiracy theorists then linked her as a secret owner of the firms because she was one of the few who initially remained in China.
According to Scam Binance, Chen once owned 93% of the shares in both Bijie Tech and Binance, among other companies. According to CZ, such claims arose from a "old campaign launched by a competitor via an anonymous microsite."
"As a result, the media and online trolls have attacked and harassed her and her family." "I never would have encouraged her to perform what looked like such a trivial action at the time if I had understood how much of a terrible impact this would have on her life," he added.
Links to China
CZ also strongly denied the claims that his company has close links to China and its government, and even went as far as discussing some of his troubling personal and business-related experiences with Chinese authorities:
“The greatest challenge that Binance faces today is that we (and every other offshore exchange) have been designated a criminal entity in China. At the same time, our opposition in the west bends over backward to paint us as a ‘Chinese company.’”
CZ believes the ill-intentioned inferences stem from the fact that he and a few other Binance employees are of Chinese ethnicity, making Binance "an easy target for special interests, media, and even policymakers who despise our industry."
“The inference is that because we have ethnically Chinese personnel, and perhaps because I am ethnically Chinese, we are covertly in the pocket of the Chinese government,” he claimed.
As recently as Tuesday, a Fortune India story described Binance as a "Chinese-origin[ed] crypto exchange," claiming that Binance and other Chinese-linked centralized crypto exchanges were "invading" India by freely operating their services within India through illegal means.
Chinese-infiltrated myths persist despite Binance never being legally formed in China and never operating culturally as a Chinese company, according to CZ.
CZ went on to say that Binance has operations in a number of countries, including France, Spain, Italy, the UAE, and Bahrain, and that the company has increased its staff globally, adding that "we are active in seeking great talent, regardless of where they belong from:"
“Over the past two years, as we expanded into Europe and the Middle East and recruited a more senior leadership team, Binance’s executive team is now more heavily dominated by Europeans and Americans.”
“Our broader employee base is even more globally distributed. Despite these facts, some people insist on calling us a ‘Chinese company,’” he added.
Having fled from China to Canada at 12, CZ later returned to start a company in 2015, but was later shut down by the Chinese government:
“Two years before Binance, I started a company called Bijie Tech, providing exchange-as-a-service platforms to other exchanges. We got 30 clients on board, and business was good [...] Unfortunately, in March 2017, the Chinese government shut down all such exchanges. All of our clients went out of business.”
CZ said that he brought a few past Bijie Tech employees in to launch Binance in July 2017. However, the Chinese government again effectively shut it down six weeks later by issuing a memorandum stating that crypto exchanges were not allowed to operate in China, adding:
“They then blocked our platform behind the Great Firewall. At this point, most of our employees left China. Only a small number of customer service agents remained by late 2018.”
Binance was legally formed in the Cayman Islands in 2017, but it does not yet have a formal headquarters.
Binance had an estimated 28.6 million crypto users as of October 2021, making it the world's largest centralized crypto exchange. In November 2021, a former Binance executive estimated the company is worth over $300 million.
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