At a sentencing hearing in Seattle on Tuesday, Qiao Changpeng received a lighter sentence. The sentence was so light that the judge sentenced the Binance founder, who had turned a blind eye to money laundering, to four months in prison instead of the one or two year sentence we all expected. Ta. Much of this leniency was made possible because Mr. Zhao, also known as CZ, took a plea deal and said all the right things. But some of that was due to mitigating factors related to “sealed” issues that the judge and attorneys mentioned multiple times during the hearing.
The crypto world loves a good conspiracy, and sure enough, the frenzied swamp of crypto Twitter is full of theories about who Mr. Zhao sold out to, or what kind of nefarious deal he must have struck. began to gush.one of the well known account Mr. Zhao was sentenced to just four months in prison for “using abusive language,” while his former rival Sam Bankman Freed was sentenced to 25 years in prison for “not using abusive language.” (an ironic claim considering the FTX founder tried to expel everyone he knew, including his ex-girlfriend and his lawyer, under the bus).
So what exactly is did Will Mr. Zhao report to federal authorities? I don't know for sure, but my guess is that the deal he entered into was based on Binance continuing to work with law enforcement to identify terrorist financing networks. .as a leo pointed Anyone who closely follows cryptocurrencies and Binance knows that the company has been supporting police and ghosts around the world for some time, helping them take out hardcore bad guys. For example, earlier this year, I spoke with Tigran Gambarian, a Binance executive and former IRS employee, who told me a credible story about how the company helped destroy ISIS strongholds in Asia. (Gambarian is currently being held hostage by Nigeria's thuggish government).
It's also useful to remember that this sweet plea deal that Mr. Zhao struck was years in the making. His decision to turn himself in came after months of negotiations between the Justice Department and Binance's army of high-priced lawyers. Mr. Zhao also had influence because he had his home and the option of remaining in Dubai, where authorities are reluctant to extradite wealthy residents. The Binance founder appears to have been biding his time for years, negotiating downward plea deals while passing useful information to law enforcement.
The most interesting thing for me now is what Binance and Zhao plan to do after the sentence is carried out. Will they go back to lawlessness if the US government backs down? Or does it plan to follow the straight and narrow path, much like the biggest players in the once-illegal alcohol and gambling industries have done? You'll find out soon. Mr. Zhao is expected to be freed by September.
jeff john roberts
jeff.roberts@fortune.com
@jeffjohnroberts
decentralized news
Federal authorities are investigating block for lack of compliance with cash app and square, which reportedly led to transactions by terrorists and sanctioned countries. (NBC)
Bitcoin The stock briefly fell below $57,000 following hawkish comments from the Fed chairman. (luck)
tether announced a record profit of $4.5 billion in the first quarter, driven by stablecoin interest and appreciation in the value of its gold and Bitcoin holdings. (bloomberg)
fortressis a publicly traded Bitcoin miner that uses an environmentally friendly process and plans to sell its coins on the occasion of the halving. (luck)
OblongWith the help of IBM and Massachusetts Institute of Technologyhas released an open source AI tool to detect money laundering based on a training set of over 200 million transactions on the Bitcoin blockchain. (wired)
Meme-O-The-Moment
A cryptocurrency folk hero is born:
This is the web version of Fortune Crypto, a daily newsletter about the coins, companies, and people shaping the crypto world. You can apply for free.
