Former Binance CEO Changpeng Zhao Must Stay In US For Time Being, Judge Says

Former Binance CEO Changpeng Zhao must stay in US for time being, judge says

By Stermy 3 Min Read

A judge has ruled that the former chief of Binance, Changpeng Zhao (CZ), cannot return to his home country, Dubai, but instead must stay in the United States while awaiting sentencing for federal crimes.

As part of the plea deal, the cryptocurrency exchange Binance agreed to pay a $4.3 billion fine for evading anti-money laundering checks, and CZ agreed to step down as its CEO. Now, he could face up to 10 years behind bars.

US District Judge Richard Jones decided on Monday that CZ cannot leave the country during the period leading up to his sentencing in February. Although he won’t be incarcerated during this time, he won’t be permitted to travel back to his home country, Dubai.

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CZ’s legal team filed a motion on Thursday, contending that he willingly attended court once and would willingly do so again.

Nonetheless, prosecutors counter that allowing CZ to leave poses a substantial flight risk, given that the majority of his wealth is situated outside the country, and the UAE lacks an extradition deal with the US. Complicating matters, the former Binance chief holds a special status in the UAE, having obtained ‘citizenship by invitation.’

The Department of Justice (DoJ) views CZ’s flight risk as potentially “manageable” if he is mandated to stay within the country. The DoJ doesn’t see the necessity for CZ’s detention during the waiting period, as long as he remains within the borders of the US.

Initially, CZ was anticipated to receive a sentence of only 12–18 months for his transgressions. However, recent filings over the weekend indicate that the DoJ might advocate for the maximum sentence of 10 years, bolstering their argument that CZ poses a flight risk.

“The defense claims that Mr. Zhao faces merely a “brief” sentence and has no incentive to flee,” the filing read. “The reality is that the top-end of the Guidelines range may be as high as 18 months, and the United States is free to argue for any sentence up to the statutory maximum of ten years.”

CZ’s sentencing hearing is scheduled for February 23, 2024. Binance’s daily volume has plummeted since the DoJ announcement, from $15 billion to close to $5 billion.

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