It is worth noting that the day before, Trump pardoned Changpeng Zhao, the founder of Binance, the largest cryptocurrency exchange in the world. This news became significant in the context of recent events surrounding the company.
In 2023, the U.S. Department of Justice began an investigation into Binance on charges of money laundering and violations of sanctions. In June of the same year, the Securities and Exchange Commission (SEC) filed a civil lawsuit, bringing 13 charges against Zhao and his company, including illegal solicitation of investors and trading unregistered securities. Additionally, the Commodity Futures Trading Commission (CFTC) also filed charges for regulatory violations. Initially, Zhao responded on social media by posting a mysterious number "4," which served as a signal for his community to ignore panic rumors. However, the scale of the accusations proved too serious to ignore.
At the end of 2023, Changpeng Zhao decided to reach a settlement with U.S. authorities to avoid a lengthy court process. In November, he pleaded guilty to violating money laundering laws and agreed to a settlement in which he paid a fine of $4.3 billion, of which $50 million was from his personal funds. He also announced his resignation as CEO of Binance. The agreement with the U.S. Department of Justice included unprecedented conditions: Binance committed to enhancing oversight and providing data on clients involved in suspicious transactions.
In April 2024, a federal court in Seattle sentenced Changpeng Zhao to four months in prison for violating the Bank Secrecy Act and insufficient measures against money laundering. The prosecution initially sought 18 months, citing that funds from criminal organizations and terrorist groups passed through Binance. During the court hearing, Zhao presented a letter of remorse, and a petition with 160 signatures was collected in his defense. Ultimately, the court imposed a relatively lenient sentence, and Zhao served his time in a minimum-security facility in California.
Although Zhao's imprisonment was short-term, it became a historic event for the crypto industry, as it was the first case where the head of a major exchange faced personal punishment. Released in September 2024, Changpeng Zhao was unable to return to active management of Binance. Under the terms of the agreement with the U.S. Department of Justice, he is permanently barred from holding executive positions in the company. Nevertheless, he remained a significant co-owner and, as he put it, became a "passive investor," not participating in operational management. He was succeeded as CEO by Richard Teng, who previously led the financial regulator of Abu Dhabi.
