cryptobriefing.com
CZ may become the richest person to ever get jailed in the US
The Binance cryptocurrency exchange logo depicted on a rising growth chart, indicating continued business expansion despite legal issues and potential jail time for founder CZ.
Binance, the world’s largest cryptocurrency exchange, continues to thrive despite the legal troubles faced by its founder, Changpeng “CZ” Zhao.
Zhao, who pleaded guilty to violating anti-money laundering laws, faces the possibility of a three-year prison sentence, as recommended by US prosecutors. Zhao is scheduled for sentencing today, April 30, after the initial sentencing date was moved earlier this year in February 23.
If the Seattle judge agrees with the prosecutors’ recommendation, Zhao would become the richest person to serve time in a US federal prison. However, his ownership of Binance and an estimated personal fortune of $43 billion remain intact. The company’s business is expected to grow as the crypto market experiences a bull run, driven in part by the launch of US exchange-traded funds investing directly in Bitcoin.
Despite the gravity of the allegations and Zhao’s guilty plea, Binance has maintained its market-share leadership in combined spot and derivatives crypto markets. The company reported adding more than 40 million new users in 2023, a 30% increase from the previous year. Customer holdings on the exchange have surpassed $100 billion, and the company is estimated to have generated $9.8 billion in annualized revenue in the 12 months through March.
Binance’s resilience is attributed to several factors, including its ability to handle the volatile nature of crypto trading and its differentiation from the now-defunct FTX exchange. Unlike FTX founder Sam Bankman-Fried, who was convicted and sentenced to 25 years in prison for misappropriating billions of dollars worth of users’ cryptocurrencies, Zhao and Binance were not charged with duping customers about the use of their funds.
Since Zhao’s guilty plea, Yi He, the mother of three of his children and a Binance co-founder, has taken on a more prominent role in the company’s operations. Zhao has also relinquished his position as the public face of Binance, maintaining a low profile since his plea agreement.
Binance’s board of directors now includes several of Zhao’s longtime friends and associates, some of whom have been with the company since its founding in 2017. The US government will assign a monitor to oversee Binance’s compliance with the plea agreement for five years, ensuring the company adheres to anti-money laundering and sanctions laws.
Despite the legal challenges, many traders using Binance have reported little change in their experience with the exchange. Some investors view the settlement as a source of increased certainty, while others remain cautious and diversify their risk across multiple platforms. Recent reports indicate that Binance itself has been venturing into new sectors in the crypto industry, with a particular focus on Bitcoin-based restaking protocol BounceBit, among other new ventures.