Changpeng Zhao, Binance’s billionaire founder, pleaded guilty to a money-laundering violation late last year. Zhao acknowledged that a lack of appropriate money-laundering systems resulted in terrorist groups and other criminals having access to Binance’s trading platform.
“I failed to implement an adequate anti-money laundering program ... I realize now the seriousness of that mistake.”
Mr. Zhao, often referred to as ‘CZ’ is often dubbed one of the most prominent figures in the crypto industry. After launching Binance in 2017, the platform became the largest cryptocurrency exchange by trade volume in a mere 8 months. As of November 2023, Zhao is ranked the richest Canadian and the 69th richest person in the world, with a staggering net worth of $23 billion.
The former CEO has now been sentenced to four months in prison, a much lighter sentence compared to other famous crypto executives who faced criminal trials during the implosion of crypto in 2022. The case and sentencing have particularly been contrasted with Sam Bankman-Fried’s trial last year.
Many, including Dennis Kelleher, have been quick to point out that the four-month sentence is more akin to a slap on the wrist when compared to the prosecution’s proposed 3-year sentence. Dennis, the president of Better Markets stated that the 4-month sentence is: “an egregious miscarriage of justice and sends exactly the wrong message to criminals worldwide.”
On the other hand, Judge Richard A. Jones, who oversaw the case, stated that Mr. Zhao is: “a dedicated family man and a giving person,” and that “[his] conduct does not warrant a 36-month sentence.”
Other than the 4-month sentence, Binance agreed to a $4,32 billion penalty in addition to Zhao’s own $50 million criminal fine and a $50 million fine to the U.S. Commodity Futures Trading Commission.
Other prominent crypto trials that are still awaiting sentencing include Do Kwon (who was charged with fraud and sent to jail in Montenegro last year) and Alex Mashinsky (the CEO of the failed crypto bank, Celsius, who is facing several criminal charges).
