(San Francisco) The former boss of the Binance cryptocurrency platform, Changpeng Zhao, was sentenced Tuesday to four months in prison for money laundering by a San Francisco court.
The founder of the company pleaded guilty last year in American justice and received a much lesser sentence than the three years of imprisonment requested by the prosecution.
According to the investigation by American authorities, Binance had not put in place the necessary measures to prevent transactions carried out for the benefit of groups such as the Islamic State, Al-Qaeda or the armed wing of Palestinian Hamas.
After pleading guilty, Mr. Zhao left his post as head of Binance late last year.
For its part, Binance had agreed to pay $4.3 billion in order to end the lawsuits against the company.
The Department of Justice wanted to make the 47-year-old leader an example within a cryptocurrency industry often singled out for its lack of regulation.
Mr. Zhao “believed that violating U.S. law was the best way to attract users, build his business and line his pockets, it was a business decision,” the department said in court documents relating to the affair.
His “conviction in this case will not only be a message for Mr. Zhao, but the whole world,” the authorities stressed.
The lawyers of the former king of cryptocurrencies called for a suspended prison sentence, pointing in particular to his repentance.
“I made mistakes”
“I made mistakes, I accept the consequences,” Mr. Zhao, a Canadian citizen who now lives in the United Arab Emirates, assured via tweet in November.
Binance was established in 2017 and quickly became the number one cryptocurrency exchange, making its founder and CEO Changpeng Zhao a billionaire.
Although the company was created in China, Mr. Zhao moved the headquarters to different countries after Beijing wanted to reduce the share of the cryptocurrency sector in its economy.
The platform allows you to buy and sell cryptocurrencies, but also offers other services, anywhere in the world. It suffered enormously from the fall of the market in 2022, but also from investigations by regulators looking into the legality of the market.
This highly volatile industry boomed in 2021, thanks to the proliferation of complex products and validation by celebrities from around the world, leading it to reach a valuation of $3,000 billion in 2022.
But a series of scandals, including the fall in November 2022 of Binance’s main competitor, FTX, and the prosecution of several officials of this company, has significantly eroded confidence and led to a massive withdrawal of investors from the cryptocurrency market.
The latter, however, have experienced a strong rebound in recent months, largely thanks to the approval by American regulators of exchange-traded funds based on bitcoin, which allows investors to trade these assets without creating specific account on dedicated platforms.