Binance Founder Changpeng Zhao Bags 4-Month Jail Sentence

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Zhao’s sentencing marks the conclusion of the process, with Judge Richard Jones ruling that the crypto entrepreneur—estimated to be worth around $43 billion, making him the richest inmate to serve time in the U.S.—must pay a $50 million personal fine in addition to his time behind bars.

The rise and fall of Changpeng Zhao

Zhao founded Binance in 2017, and it became the largest crypto exchange in just six months. Amid its meteoric growth, however, Binance struggled to implement effective “know your customer” and anti–money-laundering regimes—an embarrassing reality laid bare in complaints filed by the CFTC and Securities and Exchange Commission in 2023, including internal messages revealing that executives were aware of widespread compliance violations.

Notably, the settlement did not include fraud charges, and the SEC did not participate in the joint action. The agency continues to litigate its case against Binance in the U.S. District Court for the District of Columbia, where a judge recently held a hearing on Binance’s motion to dismiss the lawsuit.

The lack of more serious charges, along with the relatively light slap on the wrist for Zhao, led watchdog groups such as Better Markets to argue the settlement represented a “miscarriage of justice.”

“The punishment imposed simply does not fit the crime,” Better Markets president and CEO Dennis Kelleher said in a statement shared with Fortune. “In fact, the settlement is pathetic compared to the crime wave and the wealth accumulated from that criminal conduct.”

Looking Towards an Uncertain Future

While Zhao’s plea deal laid out a potential sentence of 18 months in prison, prosecutors filed a memo last week requesting he serve 36 months, citing the “magnitude of Zhao’s willful violation of U.S. law and its consequences” and arguing that it would “not just send a message to Zhao but also to the world.”

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