Binance founder Changpeng "CZ" Zhao has been released from a California correctional facility, according to reports from Bloomberg News. His release comes just two days ahead of his scheduled date, which was initially set for September 29. The U.S. Bureau of Prisons confirmed that early releases are common when the official date falls on a weekend or holiday, as in this case.
Zhao, the founder of Binance, the world's largest cryptocurrency exchange, was sentenced to four months in prison earlier this year after pleading guilty to violating the U.S. Bank Secrecy Act (BSA). This law requires financial institutions to implement anti-money laundering controls and report suspicious transactions. Prosecutors accused Binance of failing to meet these obligations, stating that the exchange had not reported over 100,000 suspicious transactions tied to criminal activities. These transactions reportedly involved designated terrorist groups such as Hamas, al-Qaeda, and Islamic State. The prosecutors also accused Binance of facilitating the sale of child exploitation materials and handling proceeds from ransomware attacks.
As part of his guilty plea, Zhao agreed to step down as CEO of Binance and pay a $50 million fine. The exchange itself was also required to settle with U.S. regulators, agreeing to a $4.32 billion penalty. Zhao's sentence, though significant, was seen as lenient given that federal prosecutors had originally sought a three-year prison term. U.S. District Judge Richard Jones, who presided over the case, noted Zhao's lack of a prior criminal record and received 161 letters of support from family, friends, and colleagues, which likely influenced the lighter sentence.
Zhao began his sentence at the low-security Lompoc II prison on California's central coast. In August, he was moved to a halfway house in San Pedro, California, where he served the remainder of his sentence. Zhao, once referred to as Inmate #88087-510, is reported to have a net worth of $25.3 billion, making him the wealthiest person to ever serve time in a U.S. prison.
This case marks a significant moment in the regulation of the cryptocurrency industry. Zhao's sentence, while shorter than expected, sends a clear message about the U.S. government's focus on compliance with anti-money laundering laws. His time in custody follows a string of other high-profile legal actions in the cryptocurrency space, including the case against former BitMEX CEO Arthur Hayes, who pleaded guilty to similar charges last year but received only probation.
As of now, neither Zhao nor his legal team has issued a public statement following his release, and representatives for Binance have declined to comment. The company's future remains closely tied to ongoing regulatory developments, particularly as it continues to face scrutiny from global financial authorities.
