Binance Founder and Ex-CEO Changpeng “CZ” Zhao has been Freed on a $175 Million Bond

CZ Admits Guilt

Changpeng Zhao, the founder of Binance, has pleaded guilty to charges related to money laundering and stepped down from his position as the CEO of the world’s largest cryptocurrency exchange.

On November 21, CZ appeared in a Seattle court and pleaded guilty to “failure to comply with anti-money laundering regulations.” Zhao’s lawyer stated that Binance’s chief had flown to the U.S. from the UAE, where there is no extradition agreement with the U.S., demonstrating his cooperation and sincerity.

The court’s sentencing for CZ is scheduled for February 23, 2024, and the former Binance CEO could face a sentence of 18 months in prison. He emphasized that U.S. regulators would not accuse Binance of misappropriating user funds or engaging in market manipulation.

Following the plea, CZ has been released from custody on a $175 million personal recognizance bond. Zhao proposed that during the waiting period for sentencing, he would return to the UAE to reunite with his family, committing to come back to the U.S. for punishment upon the court’s ruling.

CZ Admits Guilt

Binance also plans to plead guilty to criminal charges and agree to pay a total fine of $4.3 billion, including resolving civil allegations brought by regulatory authorities. The settlement aims to conclude ongoing investigations into Binance. In a recent press release, the company stated, “At its inception, Binance lacked appropriate compliance controls.”

According to WSJ sources, the CEO’s stepping down agreement allows CZ to retain a significant ownership stake in the company, despite no longer having an operational role. This outcome mirrors the previous case of BitMEX’s CEO, where former CEO Arthur Hayes pleaded guilty to money laundering violations and was subsequently sentenced to two years of probation.

Changpeng Zhao, born in 1977, is a Chinese-Canadian billionaire. He graduated in information technology from McGill University and worked at the Tokyo Stock Exchange before moving to Bloomberg LP, a financial subsidiary of Bloomberg. During this time, CZ realized the “flow of money through computer systems and never took his eyes off the financial sector.”

Before founding Binance in July 2017, CZ was a member of the development team and served as the Chief Technology Officer of OKCoin, the world’s second-largest cryptocurrency exchange at that time. During Binance’s initial coin offering (ICO), CZ raised $15 million.

Under CZ’s leadership, Binance became the largest cryptocurrency ecosystem globally. After the collapse of FTX last year, the exchange continued to increase its market share and influence. In 2021, Changpeng Zhao joined the billionaire club with a net worth of approximately $96 billion, according to Bloomberg’s ranking.

Lately, Binance has been dealing with a lot of difficulties. After regulators worldwide looked into their activities, some top leaders left the company earlier this year. In March, the U.S. Commodity Futures Trading Commission (CFTC) started investigating Binance and its CEO for potentially breaking eight rules in the U.S. Commodity Exchange Act. These rules include those related to preventing money laundering and terrorism financing. Bloomberg mentioned it as the biggest legal action the U.S. has taken against Binance so far. CNBC thought this could mess up Binance’s workings, but it was just the start of more regulatory actions against the biggest cryptocurrency exchange globally.

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Chi Do
Chi Do
Chi Do is a content writer at CoinMinutes, responsible for creating most of the content on the website, including news related to Bitcoin (BTC), Ethereum (ETH), Blockchain, Decentralized Finance (DeFi), and more. With a keen interest in cryptocurrencies since the 2020s, Chi has acquired extensive experience and knowledge in this field. Chi holds a Bachelor's degree in communication from Academy of Journalism and Communication in Vietnam.

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