Binance CZ Faces Legal Fire: Trial Commences

In November, Zhao admitted to facilitating money laundering on the Binance platform, a pivotal moment in a case that has garnered widespread attention for its purported breaches of US law and the ramifications it carries for the cryptocurrency sector.

As Bitcoinist previously covered, prosecutors have submitted a sentencing memorandum urging a three-year prison term for Zhao, double the upper limit suggested by guidelines. They contend that his offenses represent an unprecedented breach of US law.

On the other hand, Zhao’s defence team has asked for a five-month probationary term, which is more lenient. They emphasise Zhao’s admission of guilt, his charitable giving and community service records, and the length of time he has already spent apart from his family following his guilty plea.

However, Legal professionals have presented varying perspectives on the probable sentencing outcome. Neama Rahmani, a former federal prosecutor, shared with CNBC his anticipation of a one to two-year sentence, considering the case’s significant visibility.

Legal Experts Differ On Binance Zhao’s Fate

Braden Perry, formerly a senior trial lawyer for the Commodity Futures Trading Commission (CFTC), proposes a sentencing guideline advisory range of 10 to 16 months. He speculates that Zhao’s admission of guilt and settlement with multiple agencies could sway the judge’s sentencing decision.

Yesha Yadav, a law professor at Vanderbilt University, foresees a sentence ranging from a few years down to possibly just probation. Meanwhile, Tre Lovell, a corporate law attorney, predicts a shorter duration of five to seven months, pointing out Zhao’s absence of fraud charges and his remorseful letter to the judge.

Highlighting the importance of general deterrence within the crypto sector, Paul Tuchmann, a former federal and state prosecutor, anticipates the Department of Justice to push for a sentence that effectively communicates the repercussions of breaching financial regulations.

The DOJ, the Commodity Futures Trading Commission, and the Treasury Department collaborated on the case, while the Securities and Exchange Commission (SEC) pursued a separate case against Binance. The consequences for CZ and the exchange are yet to unfold.

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The author’s views are for reference only and shall not constitute any investment advice. Please ensure you fully understand and assess the products and associated risks before purchasing.

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