Binance has agreed to pay more than $4 billion to resolve most of the US investigations into it, and CEO Changpeng Zhao has resigned
Binance has agreed to pay more than $4 billion to resolve most of the US investigations into it, and CEO Changpeng Zhao has resigned. AFP

KEY POINTS

  • CZ must surrender his current passport to a third-party custodian who will retain control of the document
  • He has also been barred from obtaining new passports from any country without the court's permission
  • Zhao is out on a $175 million bond and is set for sentencing later next month

A U.S. court has ordered Binance founder and former CEO Changpeng "CZ" Zhao to surrender his passports, whether active or expired, as part of his modified bond conditions for release.

The U.S. District Court for the Western District of Washington said in a recent filing that aside from staying within the "continental United States" throughout the imposition of his sentence, Zhao must notify the Pretrial Services Agency before he travels within the continental U.S, which is an official designation of states in the country, except Hawaii.

He has also been ordered to surrender his current Canadian passport to a third-party custodian who will be employed and overseen by his on-record counsel, the court said. The custodian should "retain control over that Canadian passport and must accompany Defendant on any travel that requires identification documents."

The cryptocurrency magnate has also been ordered to surrender all of his current and expired passports to his counsel. The said identification documents will only be returned to Zhao with authorization from Pretrial Services or the court, the bond modifying order noted.

Finally, Zhao is prohibited from obtaining a new passport or other travel-related documents "from any country without the court's permission."

The latest order comes as CZ waits for his sentencing, which was pushed to late April from the initial Feb. 23 date. He is out on a $175 million bond and was denied a request to leave for Dubai. The prosecution argued that there was "no reason to believe" the United Arab Emirates would allow for Zhao's extradition if he decided not to return to the U.S., given his "favored status" in the country.

Zhao settled with the U.S. Department of Justice (DOJ) late last year, agreeing to plead guilty to violations of anti-money laundering and U.S. sanctions and a breach of the Bank Secrecy Act. He also stepped down as Binance's CEO and agreed to pay a staggering $50 million fine. Binance, on the other hand, agreed to pay $4.3 billion in fines, marking one of the largest corporate settlements in U.S. history.

In his resignation announcement, CZ admitted he "made mistakes" and must take responsibility for them. "This is best for our community, for Binance, and for myself."

Meanwhile, Binance is also faced with its own legal woes as the world's largest decentralized exchange by trading volume challenged the U.S. Securities and Exchange Commission (SEC) in an appeal to have the regulator's fraud lawsuit against Binance dismissed.

Zhao's guilty plea and Binance's whopping billion-dollar fine covers charges filed by the DOJ and Commodity Futures Trading Commission (CFTC) but it does not include fraud charges by the SEC.

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