Key Catalyst for Bitcoin Surge?

On Sep 16, 2024

Zhao’s upcoming release is fueling speculation about a potential positive impact on Binance and BNB, potentially boosting Bitcoin sentiment.
Market analysts see Zhao’s release as a key catalyst, suggesting further gains for Binance’s BNB coin and potential ripple effects on Bitcoin’s performance.

Following the case of Binance founder, Changpeng Zhao, who faced a potential sentencing of 36 months in prison as U.S. prosecutors sought a heavier penalty over allegations of facilitating money laundering. As reported by CNF, Zhao is scheduled for release from federal prison in Lompoc, California, on September 29th after serving a four-month sentence.

Zhao was sentenced earlier this year in April for various violations while leading the cryptocurrency exchange. In the Bitcoin options market, traders were “pricing a significantly larger event weight than we have seen in recent times” for the Fed meeting, according to Caroline Mauron, co-founder of Orbit Markets, a provider of liquidity for digital-asset derivatives.

Sean McNulty, director of trading at liquidity provider Arbelos Markets, also noted that

“if the guidance and press conference is significantly dovish, we’d expect Bitcoin to outperform to the topside.”

Market Reaction and Key Catalyst for Bitcoin Surge?

As CNF previously highlighted, Binance released its 12th audit of reserves, proving all its digital assets are 100% backed. These audits were introduced by former CEO Changpeng Zhao, who recently stepped down and faced sentencing in the U.S.

With Zhao’s release approaching, there is growing speculation about his next moves and the potential impact on Binance and its native BNB coin. His prison sentence followed a $4.3 billion fine for Binance related to anti-money laundering failures and violations of the Bank Secrecy Act.

Although Zhao negotiated a shorter sentence, he received a lifetime ban from holding leadership roles at Binance. News of Zhao’s upcoming release has already affected the BNB token, which surged over 8% in the past week. Market analysts suggest the token could see another 15% rise, reflecting positive sentiment surrounding CZ’s release.

As previously revealed by CNF, significant outflows from major crypto exchanges like Binance and Coinbase have reduced the supply of Bitcoin on exchanges. This reduction in supply could lead to higher demand, potentially driving Bitcoin’s price toward $70,000.

Currently, Bitcoin (BTC) is trading at $58,241.34, having decreased by 1.57% in the past day but surged by 1.85% in the past week. See BTC price chart below.