Changpeng Zhao, also known as CZ, the individual responsible for the cryptocurrency behemoth Binance, is facing major trouble. The U.S. Department of Justice has made a strong recommendation, seeking a minimum of three years of imprisonment for Zhao. That’s correct.
Last year, CZ admitted to circumventing the Bank Secrecy Act, resulting in a staggering $4.32 billion penalty for Binance and his resignation as CEO. Fast forward to the present, with his sentencing scheduled for April 30, the DOJ not only aims to take away his freedom but also impose a $50 million fine.
This is a significant development, considering that the usual maximum penalty for this type of violation is only 18 months. However, the DOJ is pushing for double that duration because they believe CZ’s actions were more than just a mistake. They view everything he did as deliberate and far-reaching, making him a scapegoat.
On April 24, Reuters reported that CZ should prepare for 36 months of imprisonment. After confessing to the breaches that led to the massive penalty last year, the request for a harsher sentence appears to be well-founded.
Let’s not forget that Binance failed to report over 100,000 suspicious transactions linked to notorious groups such as Hamas, al Qaeda, and ISIS. The platform was even involved in the disturbing trade of child abuse materials and implicated in money laundering through ransomware.
As for CZ, he agreed to pay $50 million and step down from Binance, the company he founded in 2017. The financial impact on Binance is staggering, with a $1.81 billion criminal fine and an additional $2.51 billion in restitution.
Meanwhile, CZ’s co-founder at Binance, He Yi, remains optimistic. Speaking at a meetup in Dubai, Yi focused on the positive aspects, claiming that CZ’s current situation in the U.S. is as favorable as it could be given the circumstances.
Soon, CZ will face his day in court in the Western District of Washington, where he could potentially face up to ten years in prison, although the guidelines indicate a range of 12 to 18 months. Currently, he is out on a $175 million bond with strict travel restrictions. Recently, CZ attempted to travel to Dubai, where he resides, citing a family health crisis. However, his request did not sit well with the U.S. Attorney’s Office, leading them to attempt to seize his passports. As a dual citizen of Canada and the UAE, Zhao’s international connections only complicate this extensive legal saga.
Therefore, we find ourselves witnessing one of the crypto industry’s most prominent figures facing consequences that could have significant implications for the entire blockchain sector. But that’s just CZ, always willing to take one for the team. Meanwhile, he appears to remain focused on his new venture, Giggle Academy, even sharing the finalized logo for the school earlier today.
