On Friday, former Chinese billionaire Zhao Changpeng was released from prison two days ahead of his official release date, September 29. Zhao, who was sentenced by the Seattle Federal Court in April, had been serving a four-month sentence for his involvement in money laundering activities through his cryptocurrency exchange.
Judge Richard Jones highlighted that Zhao had the resources to ensure compliance with regulations but failed to do so. Zhao's legal team initially sought a five-month probation period, but their appeal was unsuccessful.
Zhao Changpeng, born in Lianyungang, Jiangsu, is a Chinese-Canadian entrepreneur. In 2017, he founded Binance, a global cryptocurrency exchange that supports over 150 cryptocurrencies. By the end of 2021, Zhao's net worth had surged to $94.1 billion, making him the richest Chinese person at the time. As of April 2024, Zhao's wealth exceeds $30 billion, according to Forbes.
Zhao and Binance admitted guilt to money laundering charges in November 2023, and he began his prison term in April 2024. The four-month sentence was significantly lower than the three-year term suggested by prosecutors. Binance also agreed to pay a $4.32 billion fine and to appoint an independent compliance monitor for three years to enhance its anti-money laundering and sanctions compliance program.
In December 2023, the U.S. Commodity Futures Trading Commission (CFTC) imposed an additional $2.85 billion penalty on Zhao and Binance. Combined with the U.S. Department of Justice (DOJ) settlement, the total fines amounted to $7.17 billion.
The U.S. Securities and Exchange Commission (SEC) continues to investigate Binance. In June 2023, the SEC filed 13 charges against Binance and Zhao, including operating an illegal trading platform in the U.S., misusing customer funds, and offering unregistered securities.
Binance has stated that it is cooperating with the SEC's investigation and is committed to addressing regulatory concerns, indicating that more penalties from the SEC could follow.
