KEY POINTS
- Zhao was originally set to be sentenced on Feb. 23 after his guilty plea
- The Binance founder is out on a $175 million bond and has been barred from traveling abroad
- CZ stepped down as Binance CEO, admitting that he "made mistakes"
The criminal sentencing of Binance founder and former CEO Changpeng "CZ" Zhao has been pushed to late April. He was initially due for sentencing later this month.
A Seattle federal court filed a "notice of rescheduled hearing" Monday and his sentencing on a money laundering rule charge has been delayed until April 30, multiple outlets reported.
While waiting for his sentencing, Zhao is out on a $175 million bond and is in the U.S. He has been prohibited from traveling outside the United States after his request to leave for Dubai was denied.
His original sentencing date was set for Feb. 23 after he pled guilty to money laundering. While he is expected to face up to 18 months in jail, there are indications that the prosecution is seeking a longer punishment for the crypto mogul.
The prosecution argued in a Nov. 24 filing that the U.S. "is free to argue for any sentence up to the statutory maximum of ten years."
The prosecution went on to note that Zhao "poses an insurmountable risk of flight" given his "favored status" in the United Arab Emirates (UAE) and there is "no reason to believe" that the UAE would have him extradited should the Binance founder decide not to return to the U.S.
Zhao pled guilty to a charge of failing to ensure that Binance has an anti-money laundering program to protect its investors. As part of his plea, CZ agreed to pay a $50 million and the crypto exchange agreed to pay a $4.3 billion fine. He also stepped down as the CEO, admitting that he "made mistakes" and must take responsibility for them.
In mid-December, the court ruled that Zhao should stay in the U.S. until his sentencing. He was initially permitted to travel to the UAE and return weeks before his sentencing, but Washington District Judge Richard Jones said the court agrees with the Department of Justice's (DOJ) argument regarding Zhao's wealth, overseas properties and connections. The court said CZ's case was "unusual" and his defense wasn't able to establish convincing evidence Zhao wouldn't flee.
Meanwhile, Binance has legal troubles of its own as the Securities and Exchange Commission (SEC) filed a lawsuit against the world's largest centralized cryptocurrency exchange, accusing it of fraud.
The SEC alleged that the exchange was artificially inflating trading volumes, misled investors about risk controls, and suggested that there may be deceptive practices within operations.
Binance has since challenged the lawsuit, requesting for the suit's dismissal. It is the latest crypto firm to challenge lawsuits by the regulator amid increasing criticism of the SEC's crypto regulation approach.
