Valuetainment - May 14, 2026


＂They Paid People To Spy On Us＂ - Binance's RUTHLESS Rise To The World's BIGGEST Crypto Empire

Topics
entrepreneurship demands zero fee strategy
Hosted by
Patrick Bet-David
Mentioned
Binance Sam Bankman Freed Coinbase Bitcoin Btracks
＂Three Times BIGGER Than Manhattan＂ - MEGA AI Data Center Sparks Tech War With Americans ＂China Is The ENEMY＂ - Ken Paxton DEFENDS Texas' AI Data Center EXPLOSION

Episode Stats


Length

15 minutes

Words per minute

184.68

Word count

2,858

Sentence count

228


Summary

Summaries generated with gmurro/bart-large-finetuned-filtered-spotify-podcast-summ .

In this episode of the Bitcoin and Bitcoin Plus Podcast, I sit down with one of the founders of CZ Cash, a Bitcoin exchange that reached a billion dollars in profits in one year. In this episode, we talk about how CZ got to that point, how they went from $200k in revenue to $1B in profits, and how they got their first billion dollar valuation.

Transcript

Transcript generated with Whisper (turbo).
Topics generated with Qwen2.5-3B-Instruct.
Hosts, guests, and mentioned names generated with spaCy (en_core_web_sm), reconciled against Wikidata.
00:00:00 Okay, when I sell my business, I want the best tax and investment advice.
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00:00:30 People are believing what you're going to be doing.
00:00:31 They're sitting there, you know, they're believers of what CZ is going to be doing.
00:00:35 At what point was it when you're like, guys, this thing's off to the races.
00:00:40 We built some special.
00:00:41 When did that happen?
00:00:41 I think it was about a month after launch.
00:00:43 So we launched in July 14th, 2017.
00:00:46 A month after launch, we were like, we were growing.
00:00:51 The first three weeks, the BNB price was actually underwater.
00:00:54 It was below the ICO price.
00:00:55 So that was like high pressure period.
00:00:56 and then about a month later
00:00:58 but a week
00:00:59 the next week
00:01:00 B&B price went 29x
00:01:02 right
00:01:03 this is like 2,900 times
00:01:05 in one month
00:01:05 2,900%
00:01:07 in one week
00:01:08 in one week
00:01:09 in the fourth week
00:01:11 and then that's when I
00:01:12 okay
00:01:13 this thing might work
00:01:14 if it stays
00:01:15 and also our
00:01:15 we look at our user growth
00:01:17 on the platform
00:01:19 the users were growing like this
00:01:20 so there were real users
00:01:21 with real trading
00:01:22 and then it was about
00:01:24 I forgot
00:01:25 it was like maybe
00:01:25 two months three months in ask our finance like no how are we doing financially the guy said well
00:01:30 we're making a couple hundred bitcoins like like i thought that number was wrong i was like there's
00:01:35 no way we're making that kind of fees couple hundred bitcoins but back then bitcoins were
00:01:39 maybe like three thousand dollars or it's not like a hundred thousand dollars today uh well not
00:01:43 like seventy eighty thousand dollars today um but like it's but yeah it was like a couple hundred
00:01:50 bitcoins uh on on on revenue i was like there's no way that's correct and so we double checked
00:01:55 the numbers we're like okay then we got this correct but then we got a we probably got a
00:01:59 viable business wow 200 bitcoins a day no no not a day like over over a period of time over that
00:02:05 that few weeks that you're talking about over like maybe one or two months i i don't yeah and you
00:02:09 know in your mind that's a lot at that point like things are starting to pick up for us six hundred
00:02:13 thousand dollars right 200 bitcoins at 300 at uh three thousand dollars am i saying it correctly
00:02:18 $600,000.
00:02:19 Yeah.
00:02:20 I think so.
00:02:21 So things started growing.
00:02:23 And then how long did it take you guys
00:02:24 until you got the billion-dollar valuation?
00:02:26 I took a...
00:02:27 So we...
00:02:28 I don't know when the valuation is,
00:02:29 but we are one of the fastest companies
00:02:32 to reach $1 billion in profits.
00:02:34 I think that took about a year.
00:02:36 Profits took one year?
00:02:38 Yeah.
00:02:38 Not Rev.
00:02:39 Not Rev.
00:02:39 Not Rev.
00:02:40 So it's profits.
00:02:41 Yeah.
00:02:42 Well, at the time,
00:02:43 profits and Rev is pretty similar.
00:02:45 Because your margins are so...
00:02:46 Because our team is small.
00:02:48 our cost is low at that time.
00:02:51 At that time, AT&T is very small.
00:02:52 And so, yeah, that's about a year.
00:02:56 So at that time, who are the major,
00:02:58 who are the top five biggest players in crypto Bitcoin
00:03:01 in 2017, 2018?
00:03:03 Yeah, there was Polonex, which was the biggest.
00:03:05 And then later on, Btracks became the biggest
00:03:07 by the time we launched.
00:03:08 Who else?
00:03:10 Coinbase was up there, but not the biggest.
00:03:12 There was a Bitflyer in Japan who was like,
00:03:14 you know, pretty big, the biggest for a while.
00:03:18 Bitfinex was the biggest for a while, too.
00:03:22 Who else?
00:03:23 Those were kind of like the three or four players.
00:03:25 Got it.
00:03:25 So a billion dollars in profits.
00:03:28 Did you yet sense that you're making enemies or no?
00:03:32 Everybody is good with you guys.
00:03:34 You're not getting weird phone calls.
00:03:35 People are not upset at you.
00:03:37 Other people are not experiencing envy.
00:03:38 Or did you start experiencing enemies?
00:03:40 We started experiencing jealousy even from day one.
00:03:43 Even before, like just from day one we launched,
00:03:46 people were like
00:03:47 competitors
00:03:49 other exchanges
00:03:50 were somewhat hostile
00:03:51 but that's just competition
00:03:52 so that's just
00:03:53 business competition
00:03:54 nothing dirty
00:03:55 some of them are
00:03:57 a little bit
00:03:57 borderline
00:03:58 so there's a lot of
00:03:59 smear articles
00:04:00 that are sponsored
00:04:01 by our competitors
00:04:02 which is great for us
00:04:03 which is great for us
00:04:05 because we're
00:04:05 a new platform
00:04:06 we couldn't afford
00:04:07 their advertising money
00:04:08 and they were talking
00:04:08 about us
00:04:09 so
00:04:11 there has been
00:04:13 attacks
00:04:13 what we call FUD
00:04:14 fear, uncertainty
00:04:15 in doubt basically false news um for even from day one um but uh but that's i think i thought
00:04:22 that was just business competition um the regulatory scrutiny came much later um the
00:04:27 regulatory scrutiny came like 2020 like three four years later yeah the year one where you're going
00:04:33 zero to a billion in profits and you guys are getting oh my god we got 200 bitcoins what are
00:04:37 you talking about that what does your schedule look like year one oh that was the year one was
00:04:41 crazy give me the schedule what does it look like what are you doing i basically will go
00:04:45 home to sleep uh from like 2 a.m to about 6 a.m uh like that's returning home and leaving home
00:04:52 right so that's shower and sleep in between and then i will probably take a nap in the office
00:04:56 like around 2 to 2 to 3 p.m somewhere around there like depending on who's in who's what
00:05:02 meetings we have uh and the team probably did the same uh very similar stuff for like basically a
00:05:07 year um uh the whole team was in the office the whole time um the office is very high like very
00:05:13 like very loud it's just buzzing with energy it's just people yelling over each other it's like a
00:05:17 flea market um so yeah that was like the first year and um it was just constant issues constant
00:05:24 uh constant stuff happening yeah you missed that actually some of part some part of me do um the
00:05:31 there's a there's a feeling that people really miss it's like fighting with fighting the trenches
00:05:36 with your comrades, with your teammates,
00:05:38 that's a very rewarding feeling.
00:05:41 It's a very strong social connection.
00:05:44 But honestly, I don't think my body can handle it now.
00:05:48 When you tell the story and you go through a phase like that,
00:05:51 the average person, they won't believe it
00:05:53 when you tell them the story.
00:05:53 Oh, yeah, yeah, yeah.
00:05:54 Most people cannot imagine how hard we work.
00:05:56 Were you ever hospitalized for anxiety, for exhaustion?
00:05:59 Were you ever experiencing like dehydration
00:06:01 where you had to go and get yourself IV?
00:06:04 No, I have not.
00:06:05 But other people on our team have.
00:06:06 On your team.
00:06:07 Yeah, yeah, yeah.
00:06:08 Other people on our team.
00:06:09 So I tell people entrepreneurship is a physical demanding activity.
00:06:14 It's not just mental.
00:06:15 It's a physically demanding activity.
00:06:18 Our CTO still use eye drops from today.
00:06:21 From those days, he got an eye infection.
00:06:23 He had to use eye drops.
00:06:24 He still uses that.
00:06:25 Till today.
00:06:26 Till today.
00:06:26 So he's still there.
00:06:28 He's no longer CTO now, but he's still there.
00:06:30 He's one of the co-founders.
00:06:31 The original people that were there,
00:06:33 is it fair to say they're all financially successful
00:06:35 beyond the wildest imagination?
00:06:37 They all are successful.
00:06:39 And you guys are all friends still.
00:06:40 You guys have relationships together.
00:06:41 That's a beautiful thing about building something like that.
00:06:43 And 80% of the co-founders are still with the company.
00:06:47 I'm actually one of the person that, you know, stacked back.
00:06:51 And also, even the people who left, we're friends.
00:06:56 So my co-founders made money.
00:06:58 So there's a saying, especially in the Chinese communities,
00:07:01 that, you know, I have been a pretty good leader
00:07:03 that, you know, actually did my people well.
00:07:05 That's good.
00:07:06 And by the way, would you consider yourself Chinese?
00:07:09 Like if somebody asks you nationality,
00:07:11 would you say I'm Chinese?
00:07:12 No, I think I'm definitely, like, so I'm ethnicity-wise,
00:07:16 I'm Chinese, right, by blood.
00:07:17 But my thinking, my way of doing business,
00:07:20 my mental process is much, much more Canadian, U.S. even.
00:07:24 Canadian, U.S.
00:07:25 Yeah, like I think my English accent is more U.S. centric,
00:07:30 even though it may not be perfect.
00:07:33 But the way I think and I do business
00:07:35 is much more U.S. capitalist.
00:07:37 Western ideology.
00:07:39 Western ideology, freedom-driven, et cetera, yeah.
00:07:42 So let's go back to Binance.
00:07:44 So you're at a billion.
00:07:45 You're starting to get some articles
00:07:46 being written about you.
00:07:48 You're getting some enemies coming to you.
00:07:50 At this point, has Sam Bankman-Fried
00:07:53 started anything or nothing yet?
00:07:54 No, no, no.
00:07:55 He started way later.
00:07:56 He started, earliest I met him was January 2019.
00:08:00 So you start 17, you don't meet him till 19.
00:08:04 Yeah, yeah.
00:08:04 And does he have a name in the market?
00:08:06 Like, do people know who he is or nothing yet?
00:08:08 No.
00:08:08 When I met him, I didn't know who he was.
00:08:10 Our client manager tells me,
00:08:13 Alameda was a pretty decent trader,
00:08:15 a pretty big trader on Binance.
00:08:16 Like, okay, who's Alameda?
00:08:18 Okay, I'll go shake his hand.
00:08:19 Got it.
00:08:20 And Alameda was him?
00:08:21 Yeah.
00:08:22 Okay.
00:08:22 Okay, so in the market now, by 2020,
00:08:26 who is Binance by 2020?
00:08:30 By 2020, Binance has been the biggest crypto exchange for more than three years.
00:08:37 So people just view Binance as the largest crypto exchange.
00:08:41 But at that point, back to back to back, you're the King Kong of the space.
00:08:44 I wouldn't say King Kong. Binance was the largest centralized exchange.
00:08:49 But there's decentralized, there's blockchains, there's other things,
00:08:52 there's stablecoins, there's other businesses in the ecosystem.
00:08:55 The criticism that some people give is, and I wonder, of course,
00:08:59 course it's a strategy when it's the zero fee strategy that you had how did you guys what was
00:09:04 your thinking behind that what what prompted you to say we're not going to charge a fee here's how
00:09:09 our approach is going to be and you know the market's going to react to it how did that idea
00:09:14 come about i think it's a very simple business idea where um you want to put you want to provide
00:09:19 no a large amount of value and you only want to realize a small portion of it so you want to
00:09:23 provide a value of 10 and hopefully only take five for yourself.
00:09:29 If you can do that consistently, people will do a lot of business with you.
00:09:33 Your customers will come to you and you will grow quickly.
00:09:35 Why didn't others do it?
00:09:36 If it's such a simple thing, why didn't the other guys do it?
00:09:39 I think a lot of people have in their heads that they want to maximize their cut on each transaction.
00:09:44 What you want to do is actually you want to minimize your cut on each transaction
00:09:48 and you want to increase the number of transactions.
00:09:50 So you multiply the scale.
00:09:52 the scale many people just don't can't handle it many people just want to like you know i want to
00:09:57 take the maximum that's possible that's that's harsh but if but for example if you look at some
00:10:02 of the largest businesses google uh google makes fees on advertising but they provide a lot of free
00:10:08 infrastructure in in the internet space um the time clock that we use is probably synced by with
00:10:13 a google time server and that's completely free um the dns services that you know is completely
00:10:18 completely free so they provide a lot of infrastructure to run the internet completely
00:10:22 free they just make money from advertising like from some ads and now the ads is covered coverage
00:10:28 is more spread across different products but for years they only advertise on search like gmail was
00:10:34 no ads um google maps was no ads for years right so but they were able to make enough money to
00:10:40 sustain themselves we had the same we were in a very lucky for the same fortunate problem a situation
00:10:46 where our revenues from a small amount of business
00:10:50 from a few businesses were able to sustain us
00:10:52 to provide more free services to everyone
00:10:54 so that we can grow the industry,
00:10:56 we can grow the crypto industry.
00:10:58 And so if you provide a value of 10
00:11:00 and you charge only two and you can sustain yourself
00:11:03 and you can scale, your business will grow really fast.
00:11:06 So many people don't realize that.
00:11:08 You actually want to charge the minimum fee,
00:11:10 the minimum cut that you are sustainable
00:11:12 and hopefully you can scale.
00:11:14 If you can do that, you'll make way more money
00:11:16 than you charge eight or nine.
00:11:18 So where's the real money made with Binance?
00:11:21 Trading fees, actually.
00:11:22 Trading fees.
00:11:23 Just trading fees.
00:11:24 When people trade, we charge a small commission
00:11:25 or Binance charges a small commission.
00:11:28 That's, yeah.
00:11:29 Comparable to others,
00:11:30 how much lower are you compared to others?
00:11:33 I think compared to some,
00:11:34 especially some of the US players,
00:11:36 we're probably 20x lower.
00:11:38 20x lower.
00:11:39 Yeah, yeah, yeah.
00:11:39 So in some places.
00:11:42 So, yeah.
00:11:43 So we provide the lowest fees in the non-U.S. markets.
00:11:52 We don't have access to, like, that fee, we don't have access to the U.S. markets yet.
00:11:57 Got it.
00:11:57 So 20 times less than competitors.
00:12:00 So that got the world to come to you.
00:12:04 So then you have volume.
00:12:05 Did other people try to replicate that model as well?
00:12:08 People do.
00:12:09 People try, yeah.
00:12:10 To make it a zero fee, like a very low fee?
00:12:12 People try.
00:12:13 People even try to pay users to trade on them.
00:12:17 People try to have all kinds of different models.
00:12:19 Has anybody succeeded as wildly as you guys did coming out?
00:12:25 No, I would say no.
00:12:27 Fees is important.
00:12:29 Fees is one part.
00:12:30 There's other parts like how you protect users,
00:12:33 how good is customer service,
00:12:35 how well you do things overall,
00:12:37 how good is your technology.
00:12:39 There's multiple things in play.
00:12:40 But fees is important, I think.
00:12:42 So can you give me some numbers? Because when I look at the numbers that I pulled up with what you guys have done, some of these numbers are wild when you look at the stats.
00:12:51 So lifetime trading volume, $125 trillion. Total users, registered users globally, 280 to 300 million registered users.
00:13:00 At peak, you held 70% of market share during zero fee promotions.
00:13:05 Closest competitor, Bybit, only 8% of market share.
00:13:09 Revenue estimate, $16 billion to $20 billion in 2024, 2025,
00:13:13 two and a half times Coinbase.
00:13:14 I mean, I can go through a lot of these numbers.
00:13:17 It's insane what some of the things.
00:13:18 At peak promotions, 85% of total weekly volume was zero fee.
00:13:24 Market share skyrocketed from 50% to 70%
00:13:26 when you announced a zero fee Bitcoin trading on July of 2022.
00:13:32 Some of these numbers are staggering.
00:13:34 At what point were you, when did the company's valuation hit $100 billion?
00:13:41 Oh, actually, I don't even know.
00:13:42 I'm not sure if that happened yet.
00:13:45 What was the biggest milestone you guys celebrated?
00:13:48 What was something where even you were shocked by it?
00:13:51 I think we, well, Binance generally counts number of users.
00:13:54 That's probably the easiest milestone.
00:13:56 Trading volume, it's pretty easy to count as well.
00:13:59 Valuation, Binance is a private company.
00:14:02 Got it.
00:14:02 I don't think Binance has ever done a deal, had a raise or had a...
00:14:06 The numbers you will hear about is $100 to $300 billion.
00:14:09 But to you, it's a private company, so you don't even know what it's worth.
00:14:12 There's no transaction at those valuations.
00:14:13 So those are estimates by third parties.
00:14:15 But the company has never raised money at those valuations.
00:14:19 So, yeah.
00:14:20 But the thing we, for me personally, as a shareholder,
00:14:24 not running the company anymore, I just look at the user numbers.
00:14:28 I just said, look, and they publish that publicly.
00:14:31 So, you know, 300 million, 315 million.
00:14:34 Those are good numbers to service you.
00:14:37 Pretty wild.
00:14:37 To service users.
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