All right, welcome to a new episode of

Power Players with Brian Sozzi. I'm your

host Brian Sozzi and I have a special

guest here, someone that I've I've

followed his career

and background for a while, but I've

actually never seen him physically in

person. So, this is the first time for

me. He always would come remote.

Changpeng Zhao, better known as CZ. I

know him as CZ. Y'all who know and

follow Bitcoin probably know him as CZ,

too. It's good to see you in person.

>> Yes, absolutely. It's a great to be

here. It's good to meet you in real

life.

>> [laughter]

>> Likewise, likewise.

Let's talk about Let's talk about crypto

first because that was the last

conversation I had with you in November

2022. Since that time, of course, we've

seen the crypto boom. It's become

embraced by so many people,

even regulators, too, finally, of

course. Like, what is your thinking on

the current state of play in crypto?

>> I think there's actually a lot of

parallels. Crypto goes in 4-year cycles.

So, there's a lot of parallels between

November 2022 versus now.

November 2022, if I remember correctly,

the Bitcoin price was about $16,000.

This is after This is like, you know,

post

Actually, November is like right post

the FTX crash.

This is post Luna

USD crash. That was in May 2022. It

feels like yesterday.

It feels like yesterday. And then, I

think the early November was the FTX

crash. And in December,

by the time we talked, it's like

probably like, you know, right right on

the bottom at that on that cycle. So,

right now, we're in a like a

what we call a bear market again.

Bitcoin dropped to 60,000. So, there's

quite a lot of similarities in in in in

mood. But, if you look at the prices,

you know, it's three still three, four x

higher than than the last

than 4 years ago. So,

I'm pretty I'm pretty optimistic I'm

still very optimistic about the

industry, but we're going through a

winter and but you know, the industry

will recover. The industry will will

continue to grow.

>> What causes these winters?

>> I actually think it's just mass

psychology. Humans, you know, we either

we overreact. We either

given a large population of people of

masses, we either all rushing and then

you well we create this like you know

what do you call it bubble or however

you call it and then when we panic. And

then like we all sell. Like we we we

overcorrect. So while the industry may

be growing like like this,

the prices fluctuate like that around

around the value. So

I think it's just my psychology. And

then all this other news around it.

There's many of things that are

four-year cycles. Presidential elections

are four-year cycles. Stock markets are

either four or eight-year cycles.

>> But stocks always go up though.

>> [laughter]

>> I'm just kidding.

>> Yeah stocks always go up because there's

a lot of inflation. There's always more

money supply

in circulation.

If you look at the pure price of stocks.

But also like you know economies grow.

There's more companies that do bigger

things etc. So yeah stock grows. But

same thing applies to crypto. I think

there's there's a lot more

We're going to need more and more

transactions and crypto blockchain is a

new technology for money. It's not going

to disappear. It's a technology. Yeah.

>> At this stage in the game, what gets

crypto out of a crypto winter?

>> I think well there is always going to be

continued innovation. There's cycles.

The winter will always come and go. But

the industry is growing. This winter now

60,000 we think is really low.

Everyone's like panicking. But last win

last winter four years ago was 16,000.

So

so the industry is still growing. I

think we just need more applications,

more more use cases. And

I think more and more use cases are

coming. People are developing it.

And also newer industries actually help

the blockchain industry. Like everyone's

really hot on AI. But right now today AI

doesn't transact for us. AI can search

for like the cheapest ticket, the best

ticket for us. But today it doesn't buy

that ticket for us. Very soon you will.

And when he can,

um if if the AI companies want this

transaction to work globally, supporting

crypto is actually the fastest way to

enable global adoption.

>> Is that the next big unlock here you

think for for crypto? Because for the

past 2 years it was

uh it's becoming more embraced by

regulators. That was a catalyst. Well,

now we've gotten past that. Like, I

think the whole industry is looking for

this next big thing, this big moment. I

don't know if that big moment happens.

You would know better than me, but or is

it more incremental? Like, tech

companies are using crypto to transact

and that suddenly is the next hot thing.

>> Um I think it's more incremental. Also,

like, there will be little things that

what people call the next thing, you

know, DeFi was hot for a while, NFTs was

hot for a while for a while, meme coins

was hot for a while.

Um

but, all of those things will come and

they don't really go, they stay, but

they they they become less hot. Um and

I think

AI payments will come. I don't know

when, but I I would assume it's in

months, not not years. Um and

also RWAs, real-world assets,

tokenization of other assets, either

financial or non-financial assets.

That's growing much faster than I

expected. So, a year and a half ago I

thought

it would go like I don't know if it's

just hype or not. But, now it's like

it's a it's growing like a multi-billion

dollar asset allocations, etc. And it's

growing pretty quickly. So, I think RWAs

will continue to grow and I was pretty

excited about that. Um with seeing that

now, you can trade AI company stocks

using crypto globally.

>> Yeah.

>> So, which company which which country

doesn't want their stock to be traded

globally by the global audience? Uh

before, if you know, with SpaceX IPO,

only Americans traded and a few

institutions around the world can, but

you don't reach the masses. Now with

blockchain, you can reach the masses

now. Uh so,

and we've seen fairly significant

trading volumes

on those instruments. So, I think a lot

all of those things are happening. I'm

pretty excited about RWA stablecoins,

AI AI AI AI commerce, AI payments.

>> I can't help myself. You mentioned the

SpaceX IPO. As as someone who has has

led a very large company in in Binance,

has seen a lot of different market

cycles, what do you think about the

just the excitement around this

particular IPO? It's a very unique

moment. And look, SpaceX is not alone.

It's OpenAI potentially Anthropic coming

to market, too.

>> Well, SpaceX is unique in the sense that

it's not just an AI company.

It's also an internet service provider

company. It's actually the largest

internet service provider, right?

Globally.

>> It works great. Like it's a great

service.

>> It's It's fantastic. It's fast, it's

cheap, it's reliable. It's just higher

quality than like your cable. So, this

is like this is 40 years after the

internet, well, 30 30 40 years after the

internet. So, you can still build a very

strong internet like Starlink alone is a

very valuable company, right? They

somehow merged in XAI into it. And we

We got merged twice. We We invested in

the Twitter, and they got become X,

become XAI, became SpaceX. So, we kind

of indirectly got rolled into there,

which we're very happy about. But, you

know, the but it shows that you can

still build a global ISP 30 years after

the industry's matured. Right? So, like

my ISPs were all were all the rage 30

years ago, but now

Starlink is really an ISP. It just does

it very differently and it's from space.

And then now with the AI, so I think

like this one

everything Elon does is really crazy out

there, but also like tremendously

respect respectable.

>> Can you imagine data centers in space?

That is wild stuff.

>> It's wild, but like he makes a lot of

sense. Yeah, so it's [laughter] cool.

Everything he does is really cool.

Everything we do is very boring.

>> Well, you know, this is also this

[laughter] is an this is an exciting

world for the retail investor. And the

retail investor has really

they've

they've come to embrace

cryptocurrencies. You know, they want to

they want to be the

early community to embrace this

technology. How does this

new this new supply of like these

amazing tech companies SpaceX, OpenAI,

like do you see that competing

like with the demand to own crypto?

>> Uh no, no, no, not not at all. I think

this is great for

so crypto is not its own industry. Just

as like internet should not be its own

industry. It's a technology. Crypto

should not should be just a technology

that that enhances financial financial

tools, financial

applications. So exist shouldn't be a

tradify versus crypto kind of division.

Um

existing financial

players institutions should use

blockchain technologies and should adopt

all the things that's happening in

crypto. All the crypto guys should be

providing all the services that

traditional financial guys provide

including like you know trading stocks

including like you know loans

all these financial tools. So it's just

one technology that should be applied to

a service and there's no division

between crypto and tradify. In my

opinion there shouldn't be. Right now is

the industry is relatively new so the

new players can tend to be lumped into

crypto players, crypto platforms but

they shouldn't be that that's a that's a

that's a purely labeling division.

There's no reason why

for example if you look at crypto

platforms like Binance they provide

loans to

people they provide savings programs

they provide a lot of payments

solutions. They provide like you know

40, 50 different kind of financial

products to retail users around the

world using the blockchain technology

right? So there's no division. So I

think they should

all merge together.

>> Is there

is there another

I guess catalyst from a regulatory

standpoint that the crypto community

would like to see?

>> Absolutely. I think well even today the

regulatory frameworks are still early

days. You know US is still debating

about the Clarity Act. Most other

countries are still waiting for US you

know they're still looking at the to

to copy their homework. Um so we're

still early. Um I think the crypto

regulations have a long way to evolve.

Um I think it's going to go on for

multiple decades. It's probably going to

take 50-70 years for things to mature. I

can guarantee you that 70 years from now

people are still debating about this

little nuance, that little nuance, about

this new feature, new product. So it's

never going to be perfect. It's never

going to like I think we still debate

about crypto even security regulations

today, right?

>> Whether we should report earnings

quarterly anymore, yeah.

>> Yeah, yeah. So so like no, this is what

that's what like that's like a 90-year

industry. So I think it will continue.

Regulations are usually slow. They they

need industries to mature and they

slowly adjust to it. And they they're

very event-driven. Like whatever

happens, there will something will

there's new regulations to cover that so

that it doesn't happen again. Um so um

yeah, so I think it will continue to

evolve. Um I think we just we're still

pretty early. But now US is leading,

which is great to see. Um and when US

leads, everyone follows. So whereas um

if a smaller country

no problem, but if US leads the rest of

the world may or may not follow. But

when US leads, um it's it's good. It's

now we have like we have um coherence.

Everybody does the same thing. So which

is great to see.

>> How are the regulatory frameworks

different overseas? Like how have we

pulled ahead of some other countries?

>> Um I think US there's way more

discussions. There's also way more

debates.

>> [laughter]

>> There's a lot of

a lot of news, which is good for for

something that's really important,

right?

And

US is more focused on like recently more

Wait, I think there's almost a bit too

much focus on stable coins. Um whereas

other um countries are much more focused

on tokenization.

Um like say how do you tokenize national

debt? National bonds? How do you

tokenize rare earth minerals? So all of

these other countries are looking for

ways to develop their economies. US is

too, but US is really much more focused

on the US dollar, interest rates, the

banking sector.

Um so US has a more developed financial

sector, which is understandable.

But I think US leads

overall in in crypto regulations by far

now.

>> What side are you on? I'm sure you're

watching the war words between Jamie

Diamond and Brian Armstrong. What which

team are you on?

>> I don't really want I don't really pick

a team. I'm a crypto guy, so I kind of

want to be on the crypto crypto side. I

think what's but I I want to be on the

consumer side. So I think we should be

give the maximum benefits to the anyone

any business who wants to pass on the

benefits to the consumers should be

allowed to. Right? So that's the

capitalist way.

If a company like if if stable coins,

right? You give you give US dollars to

me, I put it in the bank. I issue stable

coin, I give it to you. This this money

generates interest through the through

the bank or buy US treasuries. The

business should be allowed to pass that

interest to you. To the extent that you

know the business stays afloat.

And but again,

I but I think this but that's a very

simple simplistic understanding of it. I

think there's a lot more new nuance to

to to the debates. I I know there's a

lot more.

>> Maybe these two just just need to get in

the ring and fight it out.

>> They

>> [laughter]

>> set up a UFC right beside the White

House.

You put Brian Armstrong in there with

>> [laughter]

>> with whoever else.

>> I would pay big money to watch it. As a

financial media geek, I would pay big

money to do that.

On the stable coin front, I'm glad you

mentioned stable coin cuz every

credit card company and payments company

that I know is telling me about stable

coin. Is the Is stable coin going to be

that big to support everyone in doing

something with stable coin?

>> I think so. I think stable coin is going

to be pretty big. Stable coin is really

a new form of fiat money.

10 years ago when stable coin was start

starting, I didn't understand it. Again,

I thought like this thing couldn't work.

>> Yeah, me too.

>> [laughter]

>> Like who would use a stable coin? But it

did find a intermediary between fiat

currency and

crypto and blockchain, right? Now

Bitcoin back then were like it's highly

volatile. Many people cannot use Bitcoin

because of volatility. Many like

suppliers, they buy stuff in US dollars

and they march their profit margin may

be only 10-20%. So, they cannot use a

currency that fluctuates like 20% a day.

Uh, whereas no, the stable coins fills

that gap. Uh, and also stable coins

solve the problem where in the early

days banks did not want to work with

crypto exchanges or crypto businesses,

stable coins solve that problem. And

also, uh, to wire money through banks,

if you want to send money from a US bank

to say, I don't know, bank in Singapore

or bank in China, uh, if you want. It

takes days and weeks and a lot of

procedure. Uh, with stable coin on some

one address, doesn't matter where where

the receiving is in the world, it goes

instantly. So, you does leverage the

advantages of the blockchain technology.

So, uh, and yeah, stable coin is that is

it that big? If you look at the

industry, the two big businesses sort of

in the industry, uh, exchanges and

stable coins today, right? So, stable

coins are pretty big. And I think both

businesses stable coins have not tapped

the true potential. They they're not hit

the ceiling. Right? So, stable coin

today is what? 200 billion maximum cap

market cap. Uh, that's not that big in

the grand scheme of things. Uh, I think

it can get still grow like a couple of

thousand times,

uh, a minimum. So, uh, so I yeah, so I

think there's a lot of potential for

then there's a lot of and then we're

only talking about the US dollar stable

coin. Uh,

today that's 99 99% of the stable coins

in the crypto industry. But it should be

every currency should have their own

stable coin. Uh, I should have multiple

of their own stable coin to see which

one's good. And then they should all be

transacting on chain. And when that

happens and you you will happen, when

that happens, not if, when that happens,

uh, the FX rates will be determined 24/7

on the blockchain.

>> Mhm.

>> Um,

so the FX markets will will will be will

will shift. So, I think all of that will

happen.

>> Yeah.

>> Do crypto investors just need to stop

following the likes of a Michael Saylor

and every my night minute move he is

making and just focus on the bigger

picture. The bigger picture is are some

of the things you're telling me here

about.

>> Absolutely. Absolutely. So, I look, I

think MicroStrategy is doing something

really fantastic for crypto and he's

very influential.

>> the charge in many respects.

>> He's good. But no, the guy sells 32

Bitcoins and Bitcoin crashes.

>> Yeah. It doesn't It's like it it's it

You shouldn't be reacting to something

like that.

>> yeah. So, look, like no, at some point

the guy has to like pay dividends,

right? So, he sells 32 Bitcoins. That's

like what? Like

0.001% of what what he's holding. Um and

the market reacts. But

first of all, we cannot associate we

cannot

definitely definitively say that the

market crash is related to that. It just

the timing was coincidental. Um but

yeah, I think the crypto market do um

they're they they're a bit like this is

mass Oh, sorry. I mentioned earlier,

this is mass psychology. They try to

latch onto things and certain things

just go viral and then everybody reacts.

>> Yeah.

>> It's just human nature when it's just

mass psychology. Uh so, it's

unfortunate, but I think I agree with

you, which is look, we got to look at

the bigger picture. The bigger picture

is uh money the money in the industry

will continue to grow. Uh

the economy the human economy is going

to continue to grow. The AI economy is

going to continue to grow. There's going

to be a lot more demand for money uh for

any financial tools. Um so, the

financial sector will continue to grow

and this is a new technology for for

fintech. Um so, uh this industry is

going to continue to grow.

>> Given the amount of

Bitcoin that that

I strategy now I always try to call it

MicroStrategy. Strategy now owns they

are a systemic risk to the Bitcoin

market if that doesn't work out like

they planned?

>> Uh no, I don't think so. Um

I would just call it systematic

systematic risk. But um

uh

they will have impact. So, um

we if they want to sell everything

quickly, then you they will have impact

on market price. But I think the market

the market is pretty decentralized. Even

if they hold I think that they're the

they're around 1%, right? Um even if

they hold 5 10%, the market will be able

to absorb that. Um it's just like short

term, yeah, there will be a market price

impact. But that's opportunity for many

investors who are who are long-term

driven. So, I think you know, people

worry about the price, but whenever

people's going to understand, no matter

where the price is, there always buyers.

So, when you're selling at a low price,

other people are buying. So, there

opportunities for other people, yeah.

>> Uh you recently wrote a book, right?

Yeah.

That was the other subject of this, too.

What made you write that?

>> Freedom of money, right?

>> Freedom of money, yeah, yeah, yeah. So,

I was you know, I was bored when I was

in prison. So,

I started writing a book

from prison. And then I just

for me, I I thought it was long long

time, but I had a 4-month sentence,

which is relatively short. It felt long

very long for me.

Um but then I also thought that was a

good turning point in my life.

And then yeah, and then so I spent like

almost a year and a half after I got out

and it's published.

I also think there's many um

wrong narratives about negative

narratives about crypto,

blockchain, Binance, my CZ,

the whole the whole the whole industry.

Um and the book is really a very simple

reading, very simple language. I cannot

write I don't know fancy words. So, it's

a very simple language in my in my true

words, how how I saw the evolution of a

crypto and my personal experiences. So,

for anyone who wants to learn about

crypto, I think that's at least one

view. I'm not a super early adopter, but

you know, I got in around end of 2013.

So, still relatively early

by

when we look back now. So, I just wanted

to share you know, our story with with

people who interested.

>> Yeah, we were you know, Yahoo Finance

was one of the

earlier places to talk to you and get to

know you. And you know, I like I told

you before, I got to talk to you many

times during the rise of Bitcoin to see

like what you went through

during that whole

ordeal. It was it was hard for me to

separate the same you know, this is

somebody I've talked to, I've gotten to

know at least remotely, never physically

seen him personally. Were you So, day

one, you walk into

prison. What was Do you get treated

differently because you of who you are?

Like, what is that like?

>> Uh yeah, so actually, luckily, I was not

treated differently. I was treated just

like anybody else.

>> Just like anybody.

>> Which is great. I was really worried

that they would recognize me and they

would treat me differently. And many of

the major news outlets, like, you know,

the Wall Street Journal, Bloomberg, they

reported like I was going to be I was

going to be the richest person to ever

to go to US prison. Uh and that didn't

help me, right? So, at the time, my

consultants, my lawyers were like, uh

this is you're probably a primary target

for extortion.

So, like, that psychological that

psychological uncertainty was actually

much, much heavier to deal with than the

fiscal aspects. The fiscal aspect wasn't

great. You know, you're stripped naked

on the intake, you know, they check

everything and they let you in. Um and

the conditions are pretty bad. Um

>> Just like you see on TV. They check

everything. They're they're

the the whole process.

>> The whole process or all. Yeah, yeah.

So, like, yeah, so you go in and you're

stripped naked.

Um you show your tongue, show your ears,

um and then you show under your lift

your balls, turn around, spread your

butt cheeks, cough, the whole thing. Um

and that's for every time when you have

a visitor, too. Uh before and after

>> a one-time thing.

>> It wasn't a one It wasn't a one-time

thing. The first time you go through it,

I was okay with it. Um

you know, um but it's not a it's not a

pleasant experience for anyone. Um and

um

um

also, like, for me, I'm the only person

who ever went to US to to a prison for a

single violation of a Banking Secrecy

Act, which is a registration failure.

So, um but it is what it is. It's water

under the bridge. Um I I concluded that

chapter. Also, writing the books uh

really helps conclude

>> Like, therapeutic.

>> It's kind of therapeutic. It kind of

like, you know, put to rest that

chapter. And now we're looking at a new

chapter. Yeah.

>> How did you

How did you survive day to day? How did

you plan out your day? Cuz you I mean, I

imagine it got around like, "Hey, look

who's here."

>> Yeah. So,

yeah, so people know I was like, no,

the word the word of mouth passed

around. People know I was

I'm a rich guy. But, people are still

polite.

And

uh

in prison, they put you in

in in groups by ethnicity. So, I was put

into a group with two or three other

Asians plus like

two or three Native Americans and plus

two

Hawaiians,

Pacific Islanders. So, they put us in

this little group.

So, we were like a group of six out of

this 200 people in this unit. And but

once you're in the

once you're in the little group, like

you kind of look out for each other. You

make friends everywhere.

And other people don't don't didn't

bother me. And everyone was friendly.

Everyone So, in prison, everyone's a bit

edgy. Like you kind of kind of find a

>> you fear for your life day-to-day? Like

>> No, no. There was not I don't think at

any point I feared for my life. Going

in, I was like a bit worried. I was

really worried if there was any

extortion attempts. But, once I got in,

there wasn't. And I was in a small

group. I didn't fear for my life. But,

what I feared more was

when they say four months, am I really

going to get out in four months?

>> So, you didn't even know if you were

getting out in four months. You

>> There's a lot of uncertainties.

There's a lot of people who because I'm

not a US citizen, once technically once

I finish my prison sentence, the

standard procedure is to put give me to

ICE,

immigration

enforcement.

>> Customs and Enforcement.

>> Customs and Enforcement.

And I heard stories of other inmates who

go through ICE like who they spend a

year in ICE detention center waiting for

deportation. Like for me, I want to get

out the minute I get out. But, the

problem the the standard procedure is

for for ICE to handle that.

And but there's many many ways to to to

sort of get not exceptions, just sort of

get the process that

that you that that that's optimal for

you. For me, it's very very clear. I'm

leaving the the minute I get out. So,

but there's a lot of uncertainties. Uh

the other uncertain uncertainty is

um given how anti-crypto the last

administration was when I was in prison,

um

I don't know if they were going to uh

you know, latch on some other charge um

even though they said they wouldn't. Um

but that was uncertain to me. Uh so,

there was a lot of up ups and downs. Um

I detailed this part in a lot of detail

in my book. So, for anybody who wants to

know about it.

>> it out.

>> Yeah, yeah.

>> How did you

How do you

reacclimate to yourself

or re-adjust

to the world when you when you got out?

>> So, interestingly, even with only 4

months in prison, it took me a few weeks

or maybe a couple months once I got out

to to to

uh recalibrate.

Um for the first couple of months, I

didn't really meet that many people. It

just took a while to sort of slowly

getting uh get used to it. Um and then,

you know, um I look forward to see like

what what can I do in my life? Uh what's

interesting in my life? Uh I actually

don't want to go back, you know, running

finance, etc. Like that's a you know,

that's the last chapter. Um I just

thought, you know, uh I I should do

something that's impact that has

positive impact. And I wanted I want to

be a situation when I'm 70, 80 years

old, when I look back at myself, I want

to be happy with myself. I want to say I

I tried my best. Uh so, I cared less

about legacy, what other people think

after I die. I just want to be happy

with myself. Uh that I made a positive

contribution to the maximum extent I can

or to close to the maximum extent I can.

So, I tried my best.

>> How do you How do you imagine spending

the next 25 years?

>> Um well, I think

>> of that mission ultimately.

>> Sure. So, I think um uh uh investments

is is is one way to do it. I think

investing in impactful founders like the

world-changing technologies, etc. Um and

that has a very high degree of failure.

So, many, many of our investment will

fail, but hopefully we'll invest in a

few of those that that will be extremely

successful. Um and then the free

education platform I'm work I'm working

on uh Giga Academy, uh I think education

is very fundamental. Um so this uh Giga

Academy has 500,000 kids registered now.

Um at the beginning of the year, 6

months ago, it was only 100,000. So,

it's growing pretty

exponentially. So, that means there's a

very strong demand for free education

platforms.

And then I spend the other time like I

coach founders who wants the who wants

to view me as a mentor. So, I have

conversations with maybe a dozen, half a

dozen founders at different times. And

then I also advise a few governments on

their crypto regulatory policies. Um so,

for governments who wants to value my

opinion, I'm happy to give my opinion.

>> Well, it's um it's good to reconnect

with you. I I thank you for coming down

here and I look forward to uh let's not

wait another 4 years. I appreciate it.

>> Absolutely. Like I I yeah.

Thank you for having me.

>> All right. That's going to be it for the

latest episode of Power Players. We'll

talk to you soon.