Cryptocurrency exchange: Binance founder Zhao must be imprisoned

The founder and former CEO of the cryptocurrency exchange Binance, Changpeng Zhao, also known as CZ, has been sentenced to four months in prison by a US court in Seattle. This was reported by the US technology magazine The Verge on Wednesday. The 47-year-old Canadian in November admitted that he had violated money laundering laws with Binance. He is also alleged to have circumvented sanctions laws. The court did not accept the sentence of three years' imprisonment demanded by the public prosecutor's office. The court also did not comply with the defense's request. It had demanded a suspended sentence.

The court considered it proven that Zhao laundered money via Binance and thus deliberately accepted illegal money flows. For example, transactions relating to the sexual exploitation of children, illegal drug trafficking and terrorism had been carried out via the Binance cryptocurrency exchange. He had deliberately tried to cover up traces of these transactions by instructing employees to only communicate with such customers in the USA by telephone. He had also circumvented sanctions laws.

According to the court's assessment, it is possible that Zhao will commit crimes again in the future. Accordingly, the sentence should have a deterrent effect.

Repentant Zhao

Zhao, who ranks 38th in Bloomberg's ranking of the world's richest people with an estimated fortune of around 40 billion US dollars, must pay a fine of 50 million dollars in addition to serving the four-month prison sentence. In addition, Binance has already agreed to pay a fine of 4.32 billion dollars in a settlement.

Zhao apologized before the verdict was announced and showed remorse. He is now planning to set up an online education platform. He had previously resigned from all positions at Binance. His successor as CEO is Richard Teng, who had been responsible for local markets. Binance was also subject to three years of supervision by the US authorities.

(olb)