- FTX Founder Sam Bankman-Fried and Binance Founder Changpeng Zhao faced prison sentences of 25 years and 4 months, respectively.
- The crypto titans who once ruled the crypto world fell following stringent regulatory scrutiny.
- Lawyer Braden Perry highlights that these cases show the dark and illicit corners of crypto.
FTX’s Sam Bankman Fried and Binance’s Changpeng Zhao, once the rulers of the crypto world, recently faced legal challenges and prison sentences, showcasing the space’s unpredictable nature. With the court ruling 25 years of imprisonment for Bankman Fried and a 4-month sentence for Zhao, the prolonged battle between the crypto titans reportedly ended in an anticlimactic finish.
Braden Perry, a former senior trial lawyer of CFTC, commented that the cases surrounding Bankman-Fried and Zhao highlight the “dark and illicit corners of crypto.” He added,
“Comparing CZ and SBF, both figures emerged as prominent in the cryptocurrency sector but under vastly different circumstances…The nature of their alleged crimes reflects different aspects of the ‘dark’ and illicit corners of crypto: CZ’s case seems to focus on regulatory and compliance failures, while SBF’s case hinges on direct financial misconduct and deception.”
For years, both Bankman-Fried and Zhao were at the top of the blockchain industry. They were very popular among crypto aspirants as they simplified the complexities of the crypto ecosystem.
FTX, which stood at the pinnacle of success, collapsed in 2022, leading to a protracted crypto winter. Similarly, Binance, one of the largest crypto exchanges, faced regulatory headwinds in 2023 when the Securities and Exchange Commission (SEC) filed a lawsuit against the firm for allegedly offering unregistered securities.
Though the FTX founder pleaded not guilty to the charges, he was later convicted of seven criminal counts, including using customer funds. In three weeks, Binance founder was also convicted of violating securities laws, after which he pleaded guilty and stepped down as the exchange’s CEO. Subsequently, both Bankman-Fried and Zhao were sent to prison under different circumstances.
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