Why did Zhao Changpeng receive such a lenient sentence?
On April 30th, local time, the US District Court for the Western District of Washington held a hearing where Judge Richard Jones announced a four-month prison sentence for former Binance CEO Zhao Changpeng (CZ) – finally bringing an end to the highly anticipated Zhao Changpeng case that has attracted great attention from both within and outside the cryptocurrency industry.
In fact, Zhao Changpeng and FTX founder Sam Bankman-Fried (SBF) are quite different because Binance and its founder Zhao Changpeng have not embezzled customer funds. Furthermore, unlike SBF, who chose to go through a foolish trial instead of surrendering to the court, Zhao Changpeng reached a plea agreement early on, agreeing to pay a fine of up to $4.3 billion and expressing remorse.
During the lengthy 2.5-hour sentencing hearing, the 47-year-old billionaire Zhao Changpeng was no longer just a regular criminal defendant but a philanthropist, do-gooder, first-time offender, and family man. He surrendered and accepted everything that might happen. Zhao Changpeng’s reputation as a “good person” influenced the judge’s final judgment. Compared to the US Department of Justice’s strong recommendation of a three-year sentence for Zhao Changpeng, the judge ultimately gave an extremely light sentence of four months.
Judge Jones stated that he had read all 161 letters submitted because it was important to understand who Zhao Changpeng really is. He also mentioned that he had never seen so many letters, not only from family members but also from people who have known Zhao Changpeng for a long time. Jones pointed out that these letters depicted a person driven by motivation, passion, and determination. Zhao Changpeng risked all of his net worth just to make Binance successful. The letters clearly showed that Zhao Changpeng is a devoted family man and cited examples of Binance’s charitable work.
Further reading:
US prosecutors seek a 3-year sentence! Defense team seeks probation, CZ says: willing to take responsibility for past wrong decisions
In the end, Judge Jones rejected the US Department of Justice’s recommendation of a 36-month sentence and announced a four-month imprisonment for Zhao Changpeng. The US Probation Office will confirm the start date of Zhao Changpeng’s sentence, and Zhao Changpeng stated in court that he would accept any day as the start date of his sentence.
Compared to FTX founder SBF, Zhao Changpeng’s fate is clearly much better. SBF was charged with illegally using $8 billion in customer funds and was convicted of fraud in March this year, receiving a 25-year prison sentence. In response, former US Securities and Exchange Commission official John Reed Stark stated that a four-month short-term imprisonment is only a small price for billionaires like Zhao Changpeng.
Has Zhao Changpeng already started planning for life after prison?
With a four-month prison sentence, it may just be a small episode in Zhao Changpeng’s life story. Even before the verdict was announced, Zhao Changpeng had already begun building a network of connections across the United States to plan his next steps.
After admitting to money laundering in November 2023, Zhao Changpeng did not sit back and wait. Although he cannot return to Dubai, Zhao Changpeng can still freely travel within the United States, allowing him ample time to travel across the country, establish connections with local entrepreneurs, and lay the foundation for his next moves.
According to disclosed information, Zhao Changpeng had dinner with a former US senator in Montana, visited Telluride in Colorado and a resort in Utah. More importantly, Zhao Changpeng also had a meeting with OpenAI CEO Sam Altman.
Last month, Zhao Changpeng announced the launch of a new project to promote online education. He also expressed interest in investing in artificial intelligence and biotechnology. Two insiders revealed that Zhao Changpeng exchanged contact information with Altman as early as the end of last year and discussed adjustments when expanding startups globally.
Insiders revealed that Zhao Changpeng met with Altman about a year ago and had contact during the power struggle at OpenAI in November 2023. A month later, in December 2023, Zhao Changpeng had hot pot with Gu Ronghui, a computer science professor at Columbia University and co-founder of CertiK (a Web3 security company funded by Binance), in Los Angeles. Gu Ronghui confirmed in an interview that Zhao Changpeng has been in communication with Altman, and both believe that artificial intelligence is of great help in the development of technology and human knowledge. Zhao Changpeng even revealed that he is currently “looking for opportunities” to invest in and support AI applications in large data centers.
As of now, Zhao Changpeng and representatives from OpenAI have refused to comment on their meeting with Altman.
On the other hand, in a letter submitted to the court, Zhao Changpeng revealed that he has recently had discussions with some biotechnology startups and plans to focus on disease prevention as the next chapter of his life. Zhao Changpeng said, “I want to help fund small research labs with the aim of permanently curing diseases and using blockchain technology to provide medical services to billions of people worldwide.”
In March of this year, Zhao Changpeng announced on the X platform that he is launching a project called Giggle Academy, which is a free online learning platform for children. The Giggle Academy website has already released a seven-page “concept document” stating that the platform will involve artificial intelligence, automation, and NFT digital collectibles. It is reported that Giggle Academy is non-profit, and Zhao Changpeng is recruiting a small team to work directly with him – which means that once Zhao Changpeng is released from prison, he is likely to be involved in this work and may even achieve it within a year.
Further reading:
Binance custody breaks $100 billion in assets and captures 43% market share! Zhao Changpeng and others are not idle, announcing the launch of a mysterious new project
How did the market react after Zhao Changpeng’s four-month sentence?
During Zhao Changpeng’s hearing, BNB experienced an increase and is currently trading around $580, with a 2.8% decrease in the past 24 hours at the time of writing.
On the other hand, the cryptocurrency exchange Binance itself does not seem to have been affected by Zhao Changpeng’s trial. According to Coingecko data, at the time of writing, Binance is still the world’s largest cryptocurrency exchange, with a trading volume of over $23 billion in the past 24 hours, which is about 4.6 times the trading volume of the second-ranked Bybit at around $5 billion. In addition, Binance’s monthly website visits have reached 101 million, about 2.5 times the 39.1 million visits of Bybit.
With the “dust settling” on the verdict, Zhao Changpeng’s case has finally come to an end. Perhaps due to a fondness for the number “4,” the four-month sentence seems to be a result that Zhao Changpeng and the broader crypto community can accept, and it can even be said to be a “good result.”
After the verdict, Zhao Changpeng’s wife, He Yi, only replied with two words on social media: “Got it.” Everyone understood.
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