US federal prosecutors are calling for ex-Binance chief Changpeng Zhao to be sent to prison when he appears Tuesday for sentencing on money laundering charges.
Zhao, a Canadian, resigned from his post at the world’s largest cryptocurrency exchange platform late last year as part of a deal with US authorities.
According to investigations by two Treasury agencies, Binance failed to prevent transactions by movements such as the Islamic State group, al-Qaeda or the armed wing of Hamas.
Zhao pleaded guilty to violating US anti-money laundering laws and Binance agreed in February to pay $4.3 billion to settle charges.
Prosecutors want a judge to make Zhao pay a $50 million fine and spend three years behind bars for a crime that typically results in probation, according to a court filing.
The volatile industry surged in 2021 with a range of complex products and celebrity endorsements propelling it to a valuation in excess of $3 trillion in 2022.
But a series of scandals, including the November 2022 collapse of Binance’s main rival exchange, FTX, and criminal charges for several industry executives, saw public confidence evaporate and investors pull their money out of crypto.
But the crypto industry has bounced back in recent months, thanks in large part to US regulators giving the go-ahead for exchange-traded funds (ETFs) in bitcoin which allow investors to trade the asset without actually opening a crypto account.
Binance’s new CEO Richard Teng told AFP this month that the company spent hundreds of millions of dollars on compliance and was working very closely with regulators.
AFP
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