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Founder of Binance Temporarily Confined in the US Pending Sentencing

Founder of Binance, CZ, Temporarily Confined in the US Pending Sentencing

The legal situation of Changpeng “CZ” Zhao, the founder of Binance, has compelled him to remain in the United States due to ongoing legal proceedings. A federal judge is currently reviewing a motion by the United States Department of Justice (DOJ) seeking to ensure that CZ stays in the US until his sentencing in early 2024. CZ’s situation follows his recent guilty plea on charges of violating bank secrecy laws, as well as his resignation as CEO of Binance, the world’s largest cryptocurrency exchange in terms of volume.

Conditions of CZ’s Release and DOJ Concerns

After pleading guilty, CZ was released on a $175 million personal recognizance bond, with arrangements including $15 million in a trust account and over $5 million in collateral from three sureties. Initially, the conditions of his release allowed him to go back to the United Arab Emirates, where his family resides.

However, Judge Richard Jones suspended this part of the bail release, addressing the DOJ’s concerns that CZ, with his considerable wealth, could be a flight risk, especially given the absence of an extradition treaty between the US and the UAE.

CZ is scheduled to be sentenced on February 23, 2024, and faces a potential prison term ranging from a few months to 10 years. His attorneys have argued that his voluntary return to the US to plead guilty demonstrates his commitment to taking responsibility. They have also emphasized the impracticality for his wife and children to move to the US for just a few months for the sentencing. CZ retains the right to appeal any sentence exceeding 18 months.

Judge Jones has not yet indicated a decision on the DOJ’s motion or scheduled a hearing. The case continues to unfold, highlighting significant legal and regulatory challenges faced by prominent figures in the cryptocurrency industry.

Update: US District Judge Richard Jones ruled Monday evening that, while awaiting his February sentencing, CZ will not be allowed to leave the country. Although he will not spend his time in prison, he will be barred from flying back home to Dubai.

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