'Charged with Money Laundering, Binance Founder Sentenced to 4 Months in Prison in the US'

Zhao Changpeng, founder of Binance, the world's largest cryptocurrency exchange, has been sentenced to four months in prison on charges of money laundering.

According to Bloomberg News on the 30th of last month (local time), Judge Richard Jones of the Seattle Federal Court sentenced Zhao Changpeng to four months in prison on money laundering charges.

Founder of Binance, the world's largest cryptocurrency exchange, Zhao Changpeng
[Photo by AFP Yonhap News]

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Before the sentencing, Judge Jones pointed out that Zhao Changpeng prioritized Binance's growth and profits over compliance with U.S. laws. He explained that Zhao "had the funds, financial capacity, and personnel but failed to comply with the regulations that needed to be followed."

However, Zhao's sentence is significantly lighter than the three-year prison term requested by the U.S. prosecutors on the 23rd and falls short of the one year and six months recommended by the federal guidelines. Judge Jones stated that the prosecutors failed to prove that Zhao was aware of the illegal activities in advance, making the three-year sentence inappropriate.

Compared to Sam Bankman-Fried, founder of the cryptocurrency exchange FTX, who was convicted in the first trial for embezzling billions of dollars of customer funds and sentenced to 25 years in prison, Zhao's sentence is considered very light.

Zhao appeared in court wearing a navy suit and tie, accompanied by his mother and other family members, and reportedly showed no noticeable reaction upon hearing the sentence, according to foreign media. Just before the sentencing, he told the judge, "I am sorry," and said, "I failed to implement an adequate anti-money laundering program. I now realize the seriousness of that mistake."

Zhao's legal team requested a suspended sentence, but it was not granted.

Zhao has been under investigation by U.S. authorities since 2020 on charges including money laundering, violations of financial sanctions, and fraud, and was indicted last November. He admitted guilt on charges including violations of the Bank Secrecy Act (BSA) and the International Emergency Economic Powers Act (IEEPA), which regulate anti-money laundering. Consequently, he agreed with the U.S. government to pay a fine of $4.3 billion (approximately 5.5 trillion KRW) and resigned from his position as CEO of Binance.

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