UpdatesJun 07, 2023

Binance and Coinbase executives reported financial losses as a result of a lawsuit from the SEC

Both Changpeng Zhao's and Brian Armstrong's net worth declined significantly following the US financial regulator's allegations.

The CEOs of Binance and Coinbase, as well as the cryptocurrency platforms they run, were recently sued by the US Securities and Exchange Commission. Although official charges were made recently, Changpeng Zhao has since reported a net worth loss of 5.1% and Brian Armstrong of 11.8%.

Binance and Coinbase executives have reported financial losses due to a lawsuit from the SEC

Just 30 hours after the U.S. financial market regulator filed a lawsuit against Binance, and later also against Coinbase, the two CEOs of these cryptocurrency companies suffered significant financial losses. The Chinese-Canadian entrepreneur's net worth has plummeted to an estimated $1.33 billion, while Brian Armstrong's net worth in absolute terms has fallen by $289 million.

The latest figures show that the net worth of the richest man in the entire digital currency sector and the 54th richest in the world has fallen by 5.1% this week to $26 billion. In this case, it is also worth noting that the net worth of the Binance CEO increased by as much as 106% during 2023. However, one cannot forget about the reference to the highest net worth that the founder of Binance had, which took place in January 2022. At that time, it amounted to USD 96.9 billion and simple math shows that during this period of time, the assets of the Binance CEO decreased by 70%.

In the case of Brian Armstrong, his net worth has fallen 11.8% in just this week, and his current assets are $2.2 billion. The CEO of Coinbase was also the beneficiary of the March rebound in the cryptocurrency market. This is because the net worth of the American entrepreneur increased by 61% in 2023.

Accusations of American officials towards leading cryptocurrency platforms

The SEC issued similar allegations against Binance and Coinbase as previously against other cryptocurrency platforms. The American financial regulator periodically sued such projects, among other things, for selling unregistered securities in the form of a number of digital currencies. In the opinion of this agency, among all digital currencies, only Bitcoin (BTC) can be treated as a commodity.

As a consequence of these accusations, the SEC has so far classified a total of 67 digital currencies as unregistered securities. Among other accusations, U.S. officials from this agency most often accused companies in the industry of failing to register platforms as stock exchanges, brokers or clearing agencies.