Binance founder Changpeng Zhao said the world has never been completely fair, but he has turned the page on his U.S. case, while using a new interview with Japanese business and finance outlet PIVOT to discuss Japan, crypto regulation, AI, education and entrepreneurship.
The interview came shortly after The New York Times showed parts of his current life in the Middle East. Zhao contrasted his own case with a recent penalty against Bank of America, saying the bank was fined $1.2 billion over anti-money laundering-related violations and no individual was charged, while Binance paid $4.3 billion and he served four months in prison. He said that, in U.S. history up to now, no one had been jailed solely for a standalone Bank Secrecy Act violation, and that he fell into that category.
Japan’s role in Zhao’s early career
Zhao said Japan has had a major place in his life. His first job after university was in Japan, where he worked in Tokyo on software systems for the Tokyo Stock Exchange trading platform. That period, he said, was when he first learned in a systematic way about matching engines, order execution systems and the underlying architecture of trading venues.
He described that experience as a key turning point. Over the years, he said, he has lived in Japan on and off for roughly six to seven years. When time allows in winter, he also goes to Niseko in Hokkaido to ski.
Zhao added that software he wrote in Tokyo later became part of the technical foundation for Binance. The earliest version was written in C++, requiring manual pointer cleanup and memory allocation. Those early design choices, he said, were refined through multiple iterations into the high-performance trading system that now supports Binance globally.
Binance’s launch, the China ban and the move to Tokyo
Zhao said Binance was founded in Shanghai in July 2017, but a crypto ban arrived just six weeks later. Around the same time, Japan began rolling out a licensing and registration system for crypto trading platforms in September and October 2017, issuing 16 licenses in the first batch. Even earlier, in April 2017, Japan had already recognized Bitcoin as a legal means of payment.
From his perspective, Japan was one of the earliest countries to accept crypto through a formal regulatory framework.
At the time, Binance had a team of only 30 people. Even though the platform had been live for just six weeks, Zhao said it had already found clear product-market fit, with organic growth, rising users and climbing trading volume. China accounted for only 20% to 30% of total volume, while overseas markets made up 70% to 80%. On that basis, he decided to move the whole team to Tokyo’s Meguro district, lease office space and renovate it so the company could keep serving users worldwide from there.
That plan ran into a mismatch. Binance supported trading in hundreds of altcoins, while Japan’s licensing framework at the time allowed only 10 to 20 major tokens. Zhao said that structure did not fit Binance’s business model, so the company did not remain in Japan for long.
He said Binance returned to Japan four years later. Binance Japan now holds a full compliance license in the country and has established joint ventures and partnerships with SoftBank and PayPay.
From launch to No. 1 in five months, and a $6 million user reimbursement
Zhao said Binance became the world’s largest crypto exchange by trading volume on Dec. 17, 2017, just five months after launch.
He said the result looked surprising from the outside, but it came after 17 years of work in the industry and 17 years of experience building trading systems, backed by a lean 30-person core team.
Market conditions also helped. Zhao pointed to the ICO boom in 2017, when a large number of new tokens entered the market and Binance was focused on listing and trading newer assets. At the time, five of the world’s top 10 exchanges were Japanese, but licensing rules limited them to 10 to 20 coins, which weakened their competitive position and left room for Binance to capture demand.
He also said user protection and trust were central to Binance’s rise. In 2017, many exchanges had poor technical service, with Bitcoin withdrawals frequently stuck and customer support emails going unanswered for as long as two months. Binance, he said, changed that experience.
When policy changes forced the company to move to Japan, Binance paid $6 million out of pocket to fully compensate users who suffered losses because of the regulatory shift. Zhao said the amount represented about 40% of Binance’s treasury at the time. He credited those decisions with helping the exchange build reputation and momentum.
Leaving Japan, a $1 million flood donation and his view on tax reform
Zhao said Binance withdrew from Japan in early 2018 after inquiries from the Financial Services Agency. A few months later, in July, western Japan was hit by severe flooding that killed 81 people. He said many of his old friends and former colleagues were in the affected areas, and that he donated $1 million on behalf of Binance for disaster relief.
He said business and personal feeling are separate matters. Failing to build an exchange business in Japan did not mean he would not help when disaster struck. Zhao also said the donation was the first charitable contribution of that size in crypto industry history and became the starting point for Binance Charity. He said he and his team are still proud of that decision.
On Japan’s plan to cut crypto taxes from as high as 55% to 20%, in line with stock capital gains tax treatment, Zhao called the move positive and reasonable. A 20% rate, he said, would be fair by international standards and would bring substantial capital and trading volume back to Japan.
He added that Japan tends to make decisions cautiously and over long planning cycles, but once execution begins, the speed and force can be striking. He said he hopes Japan keeps pushing in two areas:
- Stablecoins. Zhao said 99% of global stablecoins are backed by the U.S. dollar, and argued that the yen, as a major global currency, should have a stronger presence through yen-backed stablecoins.
- Tokenization. He said stocks, government bonds, ETFs, real estate and even rare resources could be tokenized, allowing global capital to flow into domestic assets more smoothly and improving liquidity.
The U.S. plea, four months in prison and stepping down as CEO
On the U.S. case, Zhao said the basic facts were straightforward. In the early period from 2017 to 2019, Binance did have U.S. users on the platform, and the company had not registered in the United States as a money services business, which put it in violation of the Bank Secrecy Act. He said the U.S. government investigated in 2022 and 2023, and that he admitted the facts and entered into a plea agreement.
Zhao said he was in the United Arab Emirates at the time, and there is no extradition treaty between the UAE and the United States. He could have stayed there, he said, but did not want to live as a fugitive for the rest of his life. Instead, he chose to fly to the U.S. voluntarily and deal with the matter directly.
He called it an unpleasant experience and a deep lesson, one he does not want to repeat, but said that chapter is over.
Zhao stressed that the case involved a financial registration and compliance violation only. He said there was no fraud and no loss of user assets. He repeated that no one in U.S. history had been imprisoned solely for a Bank Secrecy Act violation, and again compared that outcome with the recent $1.2 billion penalty against Bank of America, where no individual was charged. His conclusion was simple: the real world is not perfectly fair, and there is no point dwelling on what has already happened.
He also said being forced to step down as Binance CEO brought a sense of release. If the decision had been his alone, he said, it would have been difficult to make, and outsiders might have questioned whether he had lost motivation. Now 49, he said, he is not young but certainly not old, still has plenty of energy, and has the time, focus and resources to work on what he wants next.
Why he built Giggle Academy and how he thinks it can last
After leaving Binance, Zhao said he spent time thinking about what could create the greatest positive value for the world. He chose education.
He pointed to two major problems. First, 700 million adults globally are illiterate, two-thirds of them women, while 500 million school-age children are out of school because they cannot afford education. Second, he said many school systems flatten people toward the average. If a student is strong in Japanese but weak in math, the system often pushes that student to spend less time on strengths and more time on weaknesses, producing average outcomes. Teacher pay is also low, he said, which means many of the brightest people do not choose teaching, aside from a small number driven by mission.
Using AI, gamification and the mobile internet, Zhao said his team built Giggle Academy as a completely free education app. The starting point is age two, when children can begin to pronounce clearly and form basic cognition, and current content runs through age six.
He said the project has grown rapidly over the past two years, with the number of children learning on the platform rising from zero to 2 million. At the start of this year, that figure was 100,000, implying 20-fold growth within a year.
Giggle Academy is entirely free, Zhao said. There are no in-app purchases and no premium paid features. He is funding it personally at about $5 million a year, and the team has only 50 people.
He argued that software scales unusually well: teaching 2 million children and teaching 2 billion children carries almost no difference in marginal maintenance cost. Even at much larger scale, he said, annual costs would likely remain below $20 million to $50 million.
As for long-term sustainability, Zhao described a voluntary model. If a child studies on the platform for 18 years for free, grows up and gets a decent job, the platform might suggest that the person donate 5% to 10% of income back to the project during the first few working years. If even a small share of students choose to give back, he said, the ecosystem could sustain itself indefinitely.
AI agents, crypto-native money and micropayments
Zhao said that in the 30 years since he became an adult, he has seen three major technology waves: the internet, blockchain and AI, each arriving roughly 15 years apart.
He said he has made substantial investments in AI, but added that people should recognize a basic point: AI needs networks and it needs money. In the near future, he said, every person will have thousands of AI agents operating in the background. After an interview, for example, one agent could edit the footage, another could publish it, another could market it, and another could collect fees from viewers.
Those high-frequency agents will not use credit cards or traditional bank accounts, Zhao said. In a digital environment, the most natural native payment tool for them is cryptocurrency.
He expects AI to increase the speed of transaction turnover across society by 1,000x to 1,000,000x and to trigger an explosion in microtransactions. Instead of paying for a large monthly subscription, he said, a user might watch one short video and have AI automatically pay 1 yen, then watch another and pay a fraction more.
Zhao also said AI will rely heavily on blockchain for digital authentication, truth verification and on-chain identity confirmation. The combination of AI and blockchain, in his view, will produce a step change in economic efficiency across society.
He does not think that shift is a decade away. It could arrive within five years, or even sooner, he said. Technology is advancing exponentially; the real bottleneck is not the technology itself but how quickly societies accept it and how open governments are at the legal level.
His advice to young people in Japan: build, don’t settle for lifetime employment
Near the end of the interview, Zhao said that if he could sit down with his younger self, or with young people in Japan today, he would tell them clearly that this is the best time in history to start a company.
For him, the broad direction is already obvious: AI, blockchain and deep internet technology. If someone can find something people genuinely need in those fields and can actually build it, he said, the odds of major success and financial reward are high. The key is to sit down and make it.
Zhao said Japanese society has long carried a deeply rooted idea of spending an entire career as a salaryman at one company. He acknowledged that saying this in Japan may be controversial, but he strongly recommends that more people avoid that path and choose entrepreneurship instead.
Starting a company comes with uncertainty and pain, he said, but the social value, personal fulfillment and financial upside are on a different scale, especially now that AI tools have pushed the technical barrier to entrepreneurship to an unprecedented low.