Crytocurrency Exchange Platform Binance’s founder, Changpeng Zhao, has been sentenced to prison for four months after he pleaded guilty to charges of money laundering on his crypto exchange platform, as per a report by Reuters.
Zhao pleaded guilty in November of last year. The company admitted it was involved in anti-money laundering and unlicensed money transmission.
Speaking to Zhao, U.S. District Judge Richard Jones said, as reported by Reuters, “You had the wherewithal, the financial capabilities, and the people power to make sure that every single regulation had to be complied with, and so you failed at that opportunity.”
US federal prosecutors were looking for a three-year sentence for Zhao. "We are not suggesting that Mr. Zhao is Sam Bankman-Fried or that he is a monster,” said US President Kevin Mosley in the report. However, Mosley mentioned that Zhao’s conduct was not a mistake. US District Judge Jidge Jones felt that a three-year sentence would be too much, as the prosecutors didn’t show that Zhoa knew about these illegal activities beforehand.
"I believe the first step in 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,” said Zhao, as per Reuters.
Zhao will surrender voluntarily and is likely to surrender his detention center, which is near Seattle-Tacoma International Airport, per the report. Meanwhile, amid the ongoing crisis, Binance said in a report, “While Binance is not perfect, it has strived to protect users since its early days as a small start-up and has made tremendous efforts to invest in security and compliance. However, when Binance first launched, it did not have compliance controls adequate for the company that it was quickly becoming, and it should have.”
The crytpo world in the USA expects stricter regulations after this incident. One of the biggest scams in the cryptocurrency industry was when the founder of FTX cryptocurrency exchange, Sam Altman, stole $8 billion from his customers and was sentenced to 25 years in prison in October 2023.
