Today was an interesting day for the cryptocurrency market. Hong Kong spot Bitcoin and Ethereum ETFs did not meet expectations. Then the market sold off sharply and Bitcoin hit the $60,000 mark. In the midst of this, the founder and former CEO of Binance, the world’s largest crypto exchange, appeared before a judge. This trial represents a fateful moment for the Binance founder.

Judge rejects DOJ’s request for sentencing enhancement

Binance founder and former CEO Changpeng Zhao (CZ) appeared before a judge for sentencing today. Meanwhile, Judge Richard Jones denied the Department of Justice’s (DOJ) request to extend CZ’s prison sentence. The DOJ had sought to extend Zhao’s sentence from 18 months to 3 years, claiming that he was involved in illegal activities related to cryptocurrency transactions. However, Judge Jones expressed doubts about the DOJ’s argument, highlighting the lack of evidence showing that Zhao was aware of any wrongdoing.

During the hearings, Judge Richard Jones rejected the Justice Ministry’s request for a sentence enhancement on the grounds that there was insufficient evidence linking Zhao to illegal activities. The judge noted that there was no indication that Zhao was informed of any illegal behavior. Therefore, he rejected the DOJ’s claim that Zhao was aware of such activities. The reporter, who watched the hearing live, announced the development with the following post:

Judge Richard Jones said he did not accept the Justice Department’s request for a sentence enhancement that would have increased the sentence from 18 months to 3 years: “There is no evidence that the defendant was informed of the illegal activities.

The Justice Department’s claim and the Binance founder’s defense

The Justice Department’s lawyer argued that Zhao’s entry into the US financial system showed a willful violation of the law. The lawyer emphasized that Zhao admitted that he sought forgiveness rather than permission in his efforts to build the world’s largest cryptocurrency exchange. The defense team representing Zhao did not ask for house arrest. But it suggested probation as an alternative to incarceration. The lawyers emphasized Zhao’s cooperation and acceptance of responsibility as factors to be considered in sentencing.

Correction: CZ’s team did not ask for house arrest, they only suggested it as an option. The original request was for parole.

The decision and its impact on crypto regulation

The outcome of this sentencing has broader implications for the enforcement of financial regulations in the cryptocurrency sector. The Justice Department’s argument that Zhao’s case sets a precedent for regulatory enforcement underscores the importance of this legal battle. Meanwhile, the Judge will hear arguments from all interested parties before the final ruling.

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