Changpeng Zhao, also known as 'CZ', the founder of Binance - the world's largest crypto exchange - has begun his prison sentence at a federal prison in Lompoc, California. This event has elicited mixed reactions within the crypto community, with many expressing their support and admiration for Zhao.
Support from the Crypto Community
Within the crypto community, Zhao's decision to accept and serve his sentence is seen as a positive step for both himself and Binance. By acknowledging his guilt and stepping down, Zhao may have avoided a scenario where Binance could suffer a fate similar to FTX.
Zhao’s Future Plans
Zhao has already outlined his plans for after his sentence. He is determined to remain involved in the cryptocurrency world once he has served his four-month sentence. He emphasized that he will retain his existing crypto holdings and continue to invest passively, underscoring his enduring confidence and commitment to the crypto market.
Zhao’s Conviction
In April, Zhao was sentenced during a hearing at the U.S. District Court for the Western District of Washington to four months in prison on charges related to money laundering activities at his crypto exchange. He was also fined $50 million. This penalty was significantly lower than the three years in prison initially sought by federal prosecutors. Despite guidelines recommending a sentence of 12 to 18 months, Zhao’s lawyers had argued for a five-month probationary sentence.
Before his sentencing, Zhao apologized for his actions and stated that he had “had a lot of quiet time alone to think and reflect.” He accepted responsibility for Binance's failure to implement an effective anti-money laundering program.
In November, Zhao reached an agreement with the U.S. government to end a years-long investigation into Binance. As part of the settlement, Zhao stepped down as CEO of the company. U.S. authorities also ordered him to pay $4.3 billion in fines for "civil regulatory enforcement actions." Zhao agreed to pay a fine of $50 million.
