Binance founder Changpeng Zhao (CZ) has revealed why he chose to face US prosecutors during his anti-money laundering violation case, rather than utilizing his UAE citizenship to avoid US law enforcement.
Speaking in a fireside chat with Anthony Scaramucci on August 19 at the Wyoming Blockchain Symposium in Jackson Hole, Zhao shared details regarding his decision before serving a four-month prison sentence and stepping down from his leadership role at Binance.
Choosing Accountability Over Evasion
Zhao stated that he obtained UAE citizenship approximately six months before the Binance case became public. Because the UAE has no extradition treaty with the United States, he could have remained in the Middle East to avoid US courts. However, he noted that running away did not feel honorable.
“Actually, I was granted citizenship of the UAE, but I didn’t want to leverage that,” Zhao said during the chat, adding that resolving the situation was better for himself, Binance, BNB holders, and the wider cryptocurrency industry.
According to Zhao, he initially expected a much lighter punishment because his case involved a single Bank Secrecy Act violation with no allegations of fraud. He compared his case to that of former BitMEX executive Arthur Hayes, who received six months of home confinement after pleading guilty to a similar Bank Secrecy Act violation.
Settlement and Aftermath
Zhao ultimately served four months in federal prison at the Federal Correctional Institution Lompoc II in Santa Barbara, California, leaving the facility near the end of September 2024. The Justice Department had originally recommended a three-year sentence, while his legal team had requested no prison time.
Reflecting on Binance's position at the time, Zhao noted that the platform was the world's largest crypto exchange and remarked that its international presence made it a prominent target.
As part of the resolution, Zhao stepped down as CEO after Binance agreed to a $4.3 billion settlement with US authorities. He also paid a $50 million personal penalty. A year later, President Donald Trump granted him a full and unconditional pardon.
