By Elizabeth Lopatto , a reporter who writes about tech, money, and human behavior. She joined The Verge in 2014 as science editor. Previously, she

Binance founder Changpeng Zhao sentenced to four months in prison

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2024-04-30 21:30:04

By Elizabeth Lopatto , a reporter who writes about tech, money, and human behavior. She joined The Verge in 2014 as science editor. Previously, she was a reporter at Bloomberg.

Binance founder Changpeng Zhao was sentenced to four months in prison for failing to establish adequate anti-money laundering protections. Zhao, once the head of the largest crypto exchange in the world, pleaded guilty in November 2023.

Judge Richard Jones says that Zhao prioritized “Binance’s growth and profits over compliance with US laws and regulations.” While Jones doesn’t think Zhao is likely to reoffend, the scale of the crime is notable.

Though Zhao is not as well-known as FTX fraudster Sam Bankman-Fried, he is a more important figure in the crypto world. The Chinese-Canadian entrepreneur founded Binance in 2017. Though he was required to step down as CEO of the exchange as part of his plea agreement, he is still the controlling shareholder of the company, which one person told Bloomberg was “a massive shitcoin casino.” Binance listed many more tokens than competitors such as Coinbase.

Prosecutors requested three years of prison time, double the sentencing guideline of 18 months, because the “scope and ramifications of Zhao’s misconduct were massive,” they wrote in their sentencing memo. They also suggested that Zhao’s sentence should “reflect the significant harm to US national security caused by his criminal acts.”