Founder of Binance exchange Changpeng Zhao, has come to the fore recently due to the penalty proposed by the US Department of Justice (DOJ). Found guilty of violating the Banking Secrecy Act last November, CZ was forced to resign as CEO. The stock market also admitted these violations and faced a significant penalty of $4.32 billion. Now, Zhao is set to be sentenced on April 30, and the DOJ is seeking a 36-month prison sentence along with a $50 million fine.
As Koinfinans.com reported, the severity of the proposed penalty was notable for several reasons. First, federal sentencing guidelines generally call for a maximum sentence of 18 months in prison for such violations. However, the Justice Department argues that Zhao did not act intentionally and that the effects were serious. The latest application includes the following statements: “The sentence in this case will be a message not only to Zhao, but to the whole world. “Changpeng Zhao has made huge profits by violating U.S. laws, and the price of this violation should serve as a deterrent to others who seek to build wealth and business empires by breaking U.S. laws.”
While the DOJ emphasizes the seriousness of Zhao’s violations, some critics also consider Changpeng Zhao’s contributions to the industry. For example, Binance has become one of the largest and most influential exchanges in the world under CZ’s leadership.
Changpeng Zhao’s personal situation also complicates the scenario. One of them is that he cannot return there because his family lives in Dubai. The sentencing hearing was postponed from late February to April 30, adding to the uncertainty surrounding it.
Last week, Binance co-founder He Yi injected some hope into the market by stating that CZ’s situation in the US was relatively stable. However, the possibility of a long prison sentence remains a concern for Binance and the entire cryptocurrency market.
