Binance news update:
On Tuesday, Changpeng Zhao, formerly the CEO of Binance, was sentenced to four months in prison after admitting guilt of violating U.S. laws on money laundering at the world’s largest cryptocurrency exchange. Once hailed as one of the most influential figures in the crypto industry, Zhao, also known as “CZ,” becomes the second major crypto executive to face prison time.
The sentencing, delivered by U.S. District Judge Richard Jones in c, falls short of the three years requested by prosecutors and is below the maximum 1-1/2 years recommended under federal guidelines. It contrasts sharply with the 25-year sentence handed to Sam Bankman-Fried in March for embezzling $8 billion from customers of his now-defunct FTX exchange, a conviction Bankman-Fried is currently appealing.
Despite the shorter prison term, prosecutors expressed satisfaction with the outcome of the lengthy investigation into Binance and Zhao, who had been residing in the United Arab Emirates, beyond the immediate reach of U.S. authorities. U.S. Attorney Tessa Gorman described the day as “epic,” emphasizing the importance of incarceration in this case.
Before delivering the sentence, Judge Jones criticized Zhao for prioritizing Binance’s growth and profitability over compliance with U.S. laws, noting that Zhao had the resources and capacity to ensure regulatory compliance but failed to do so. Zhao, 47, remained composed upon hearing the verdict, clad in a navy blue suit and tie in the courtroom, accompanied by his mother and other family members. His defense team had requested probation.
Critics, such as Dennis Kelleher, head of the financial reform advocacy group Better Markets, lamented the message sent by the lenient sentence, suggesting that Zhao’s retention of his substantial wealth despite his conviction implies that “crime pays.”
