Zhao’s pivot to education amid DOJ plea deal

Despite being banned for life from day-to-day management, Binance’s former CEO Changpeng Zhao maintains his influence as majority shareholder, even as he focuses on education activities.

Despite being barred from running Binance, one of the largest cryptocurrency exchanges by trading volume, as part of an agreement with the U.S. Department of Justice, former CEO Changpeng Zhao may continue to have significant influence over the company as a majority shareholder, Axios has learned.

Legal experts say the language of the agreement leaves Zhao’s involvement open to interpretation and creates uncertainty about how much control he may continue to wield behind the scenes.

The DOJ’s settlement with Binance, which was finalized in November 2023, prohibits Zhao from “managing or operating” the company, but the details of that restriction are less clear. While reports initially suggested a three-year ban, Binance CEO Richard Teng eventually confirmed to Axios in a comment that the restriction is actually a lifetime ban from day-to-day management.

“Of course, CZ will retain all shareholder rights as he is the largest shareholder.”

Richard Teng, Binance CEO

However, Teng clarified that Zhao, as the largest shareholder, continues to retain “all shareholder rights”, including the power to nominate board members and replace directors.

Transition to education

This legal ambiguity raises questions about what constitutes “managing or operating” the company. For example, the report notes that Zhao could theoretically act as an advisor or exert influence over key decisions without violating the terms of the agreement.

My next project. @GiggleAcademy (No logo yet)

Free basic education for all (around grades 1-12).
There is no income.
Gamified.
Adaptable.

Read the Concept Paper at: https://t.co/knqmZF0sQ8

WE ARE HIRING. A small team, we work directly with CZ.

— CZ 🔶 BNB (@cz_binance) March 19, 2024

Zhao has previously hinted at a shift into education following her departure from Binance. In March 2024, she introduced Giggle Academy, an education platform designed to provide free basic education to underprivileged children in developing countries, on her X page.

The platform has a “gamified” and adaptive approach that rewards progress with non-fungible token badges, but it distances itself from the crypto world by eschewing the use of cryptocurrencies. While Zhao’s role as majority shareholder in Binance remains significant, his new education initiative signals a move toward creating a broader legacy beyond the crypto industry.