A federal judge has decided to send the former CEO of Binance, Changpeng “CZ” Zhao, to prison for four months. The decision came after Zhao pleaded guilty to violating U.S. money laundering laws.
Sentencing Details
In a hearing on April 30th in the U.S. District Court for the Western District of Washington, Judge Richard Jones handed down the sentence. Prosecutors had initially recommended a three-year prison term, but the judge settled on four months.
Judge Jones stated that there was no evidence Zhao was aware of specific illegal activities at Binance. He rejected prosecutors’ request for a longer sentence, noting that Zhao shouldn’t profit from his actions.
Prosecutors argued that a probationary sentence would encourage others to break the law on a large scale. They emphasized the seriousness of the offense and the need for incarceration.
CZ Zhao’s Defense
Zhao’s legal team argued for probation, citing sealed documents presented to the court as a mitigating factor. They also expressed concern about Zhao’s safety in prison due to his wealth.
Before sentencing, Zhao apologized for his actions and acknowledged Binance’s failure to implement an effective Anti-Money Laundering program. He accepted responsibility for his role in the matter.
Impact of CZ Zhao’s Ruling
Zhao’s sentencing follows that of former FTX CEO Sam Bankman-Fried, who received a 25-year prison term for similar charges. The cases have drawn attention to the legal risks facing prominent figures in the crypto industry.
The next figure facing charges in the crypto space is Alex Mashinsky, the former CEO of Celsius. His criminal trial is scheduled to begin in January 2025 in the United States.
