Kaspa (kas) 
Binance founder Changpeng Zhao has reportedly begun a four-month sentence at a low-security federal prison in Lompoc, California. The information was confirmed by his legal team from Latham and Watkins, and further shared by blockchain influencer and crypto investor EljaBoom on social media.
EljaBoom, referring to Zhao as his “friend,” stated that the former Binance CEO had started his prison term. He highlighted that low-security prisons offer more freedom to inmates as they are not considered dangerous and are trusted not to escape.
Low security means prisoners have more freedom because they are not considered dangerous and are trusted not to escape.
Zhao, often called “CZ” in crypto circles, was sentenced in April after pleading guilty to charges that Binance violated U.S. anti-money laundering laws. Following his guilty plea, U.S. authorities required Zhao to step down as CEO of Binance. Under his leadership, Binance became one of the world’s largest cryptocurrency exchanges by volume.
Prosecutors claimed that part of Binance’s growth involved processing transactions from illegal activities. They also accused the exchange of facilitating transactions between U.S. users and individuals in countries under U.S. sanctions, such as Iran. Despite stepping down, Zhao reportedly still holds a significant stake in Binance, estimated at 90%.
The four-month sentence given to Zhao was notably less than the 12 to 18 months recommended by federal sentencing guidelines and significantly below the three years initially recommended by the U.S. Department of Justice. Zhao’s attorneys had argued for probation, emphasizing that no one in a similar case under the Bank Secrecy Act had been sentenced to prison.
As part of the legal resolution, Binance was ordered to pay $4.3 billion in fines and forfeiture. Zhao personally agreed to a $50 million fine.
After his sentencing, Zhao outlined his future plans, indicating that he intends to return to the crypto industry after completing his sentence. He plans to focus on maintaining his existing crypto holdings and engaging in passive investing. Zhao emphasized that the period following his guilty plea marks “a new stage for the crypto industry,” stressing the importance of adhering to regulations and compliance.
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