Billions flowed, founders fled, and retail was left picking up the pieces.
When regulators came knocking on Binance’s doors in late 2023, CEO Changpeng Zhao—aka CZ—quietly struck a deal. $4.3 billion in penalties were settled, and CZ stepped down, calling it a “personal sacrifice.”
But insiders were already shifting assets, relaunching platforms offshore, and securing their profits—while retail investors were left stuck.
According to Decrypt, Binance had moved user data, token reserves, and systems out of reach of U.S. law. One ops exec even joked: “It’s not fraud if no one catches it.”
The Shadow Exchange Era Begins
Omar Hussain, a 27-year-old trader from Karachi, had $190,000 in Binance’s Earn program. After a sudden “compliance pause,” his account was flagged and frozen. “They said they were protecting me,” he said. “But it felt like a trap.”
Meanwhile, Binance launched spin-offs like Bifinity Global, hiding leadership ties. Wallets linked to Binance were still active, funneling funds into these new platforms.
Over $1.2 billion in user claims are pending. Only $67 million has been returned through legal channels. Most users got nothing.
Binance Survived, But Trust Didn’t
Even after all this, Binance’s new venture—BNZ Global—is now sponsoring sports teams and DeFi events. Their new message: “Trust the tech, not the past.”
In Jan 2025, Omar joined a U.S. lawsuit against Binance. The company dismissed his case as “baseless” and pointed to its disclaimer:
“Your funds may become permanently unrecoverable.”
As one DeFi analyst said:
“They’re banking on users forgetting everything. And honestly, it’s working.”
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