- CZ gets only months while SBF gets 25 years in prison for the same crime
- People were not happy with both, but the DOJ decided that four months was enough for CZ
- Can Binance's CZ sentence impact the cryptocurrency industry?
CZ gets only months while SBF gets 25 years in prison for the same crime
Cryptocurrency boys have fallen. These two characters were put at the top, and people often promised them a bright future. However, fraudulent activities, scams, and a series of unfortunate events led both of them to trial
These cryptocurrency geniuses had different outcomes at their trials and many speculate why this happened. One former CEO went to trial and maintained his innocence, claiming he did nothing bad and that he just 'messed up'. The other crypto boy admitted fault and turned himself in.
Two big names in the crypto world are going to prison in the USA for different lengths of time even though they did pretty much the same crime and caused their cryptocurrency companies to collapse. Sam SBF Bankman-Fried and Changpeng CZ Zhao, who used to lead major crypto companies, are facing questions about why their punishments are so different[1].
Bankman-Fried might be in prison for 25 years, while Zhao will only be there for four months. Let's go back to what happened. Bankman-Fried got arrested in 2022, brought to the USA, said he didn't do it, was put on house arrest, then sent to jail after being accused of scaring witnesses, had a trial and was found guilty.
Zhao was charged in 2023, said he did it, stayed out of jail on bail, got four months in prison, and will go there soon. Bankman-Fried was accused of seven serious crimes, including cheating investors and using their money wrongly. Zhao's charge was about not having good enough rules to stop money laundering at his company.
People were not happy with both, but the DOJ decided that four months was enough for CZ
Some say Bankman-Fried's crime was worse, like Mark Bini, a former lawyer. He says Zhao's crime was more like breaking rules, while Bankman-Fried's was about secretly taking lots of money from his company to help another one.
Since his legal troubles began, Bankman-Fried and his team have mostly said he did what he thought was okay. During his sentencing, Judge Lewis Kaplan accused him of lying in court and not being clear in his answers[2].
After getting a 25-year sentence, Bankman-Fried said he never thought what he did was against the law. Evidence presented during the trial also didn't help his case, as witnesses, including his ex-girlfriend and the CEO of Alameda Research, suggested he used money from FTX users in the wrong way.
On the other hand, Zhao didn't talk about his case publicly after he agreed to pay a $4.3 billion fine and admitted guilt in November 2023. He got support from many people, including industry leaders and family, which the judge noticed during his sentencing.
Despite people thinking Zhao might have done worse things, the Department of Justice didn't have enough proof, so he only admitted to lesser crimes in his deal. He's only paying $50 million as part of his deal with the Department of Justice.
Can Binance's CZ sentence impact the cryptocurrency industry?
Social media filled up with pictures of these two together, and many called both of them the richest inmates ever. People congratulated CZ and SBF on the reconciliation of their friendship at the prison. However, it's unlikely that Zhao and Bankman-Fried will be in the same prison or even the same area.
Bankman-Fried might go to prison in the San Francisco Bay Area, or he might stay in New York while he appeals his case. Zhao will be in prison for four months, either in Oregon or Washington, but the exact date isn't set yet.
On April 30, the court decided CZ's punishment. This caused a lot of talk in the crypto world about what it means for Zhao. Last year, when Binance agreed to pay $4.3 billion to the Department of Justice and Zhao quit, it made investors nervous because Binance is a big deal in the crypto world. Even though it seemed bad at first, some experts don't think Zhao's punishment will hurt the market much. Usually, when governments get tough on crypto, prices drop.
FTX also had a rough time, which made the market go down. But that was because FTX, the second biggest exchange, had problems, not just because of government investigations. Right now, Bitcoin is trading at $57,560, which is down 6.4% in the last day, and the wider market is down 5.33%. Some people think this drop is just the usual ups and downs of prices, while others think it's because of Zhao's punishment[3].
Another interesting thing is that even though Zhao is going to prison, he's still super rich, with about $33 billion. Even though he's not CEO anymore, he still owns a lot of Binance. This is similar to what happened with Sam Bankman-Fried from FTX, but authorities say their cases are different.
After quitting Binance, Zhao started a program called Giggle Academy to help kids in need. SBF continued to say that he was not responsible and that he had no idea what he was doing. This is the reason why people look differently at these golden boys[4].
