Binance Founder CZ Says Prison Record Didn’t Hurt Business

Changpeng Zhao, the founder of Binance, said his prison record has not been a major obstacle to his business activities since his release. He also said he is focused on serving as an investor and adviser rather than returning to Binance.

CoinDesk reported on June 25 that Zhao said in an interview that his guilty plea and prison record had not become a burden on future business partnerships.

He said he simply explains that the case involved a violation of the Bank Secrecy Act, or BSA. Once people understand there was no fraud, many trust him more, he said, adding that many people confuse the issue.

Zhao is the founder and former chief executive officer of Binance, the world’s largest cryptocurrency exchange. He pleaded guilty to violating the U.S. Bank Secrecy Act and served four months in federal prison. He was later pardoned by President Donald Trump.

He acknowledged Binance had fallen short in its past regulatory response. Zhao said he did not live in the U.S. and Binance started in Shanghai before moving to Malta, Singapore and other jurisdictions. At the time, he said, he did not realize U.S. law was effectively applied globally.

The U.S. Department of Justice said in 2023 that Binance and Zhao had failed to take basic steps to comply with anti-money laundering and sanctions rules. Under that settlement, Zhao stepped down as Binance CEO and severed management ties with the global Binance exchange.

Zhao said he has little desire to return to Binance. He also said he has no intention of running Binance’s U.S. unit. CoinDesk said Zhao is focused on his roles as an investor and adviser and is involved with YZi Labs, a $10 billion family office converted from Binance’s former venture capital arm, and the free education platform Giggle Academy.

He also spoke about life in prison. Zhao said fellow inmates and prison guards asked him questions about cryptocurrencies while he was incarcerated. One question was whether they should buy Bitcoin. He said he told them he had no internet access, so he did not know what had happened that day or what would happen the next day.

After his release, Zhao said he wanted to keep his distance from the U.S. for a time. He said he wanted to be as far away from the country as possible and stay out of the spotlight.

But his view of the U.S. changed after the pardon, he said. The country is capable of correcting itself, he said, and that made him realize why the U.S. holds a leading position in the global economy, military power and policy influence.

Zhao said he will not get involved in U.S. politics. Still, he said he supports the country’s goal of becoming a global hub for digital assets. He said he holds no grudge and wants to support the growth of crypto anywhere in the world. To do that, he said, he also needs to help the U.S. crypto industry grow.

He also said the prison experience had in some ways worked in his favor. Going through a difficult period and being tested without any real problem being found says something about character, he said. He added that while he does not dispute the BSA violation, there was no fraud.

Still, Zhao did not completely rule out a return to Binance. Being a CEO is highly demanding and time-consuming, he said. For now, he is taking a breather and believes his biggest contribution is helping other founders build their companies.