Ex-Binance CEO Jailed, Industry Faces Regulatory Heat

Ex-Binance CEO Jailed, Industry Faces Regulatory Heat

(Photo : by PATRICIA DE MELO MOREIRA/AFP via Getty Images)

Former Binance CEO Changpeng Zhao, commonly known as CZ, expressed appreciation for the support from the crypto community following his sentencing to four months in U.S. prison for money laundering charges.

He stated his intention to remain a passive investor and holder in crypto, emphasizing the importance of compliance in the industry's new phase. CZ acknowledged the scrutiny Binance has faced and thanked supporters for their encouragement, pledging to focus on the next chapter of his life after serving his time.

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Zhao entered a guilty plea to charges of money laundering in November of the previous year. At first, he was urged for a 36-month sentence by US prosecutors. He made this deal with the United States. Department of Justice (DOJ), CZ resigned as Binance's CEO. In addition, Binance was hit with a $4.3 billion charge by the US, and Zhao consented to pay a $50 million fine.

In court, CZ acknowledged his shortcomings, stating, "I'm sorry ... I believe the first step of taking responsibility is to fully recognize the mistakes ... Here I failed to implement an adequate anti-money laundering program ... I realize now the seriousness of that mistake."

Before his sentencing, Zhao penned a letter to the presiding judge, expressing regret for his "poor decisions" and accepting "full responsibility" for his actions. He admitted that, in hindsight, he should have prioritized implementing compliance changes at Binance from the beginning, acknowledging there was no excuse for his failure to establish necessary compliance controls. He expressed a desire to change that aspect of Binance's history but highlighted that under his direction, Binance has since implemented the most stringent anti-money laundering controls among non-U.S. exchanges, effective since 2022.

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