The former chief executive of Binance, Changpeng "CZ" Zhao, is awaiting his sentencing on Tuesday after pleading guilty in November to one count of violating the Bank Secrecy Act. U.S. prosecutors are pushing for Zhao to be sentenced to three years in prison, which is notably twice the amount recommended under federal guidelines that cap at 18 months due to his guilty plea and cooperation. The sentencing hearing began on Tuesday morning around 9:40 a.m. PDT.

Zhao's defense team has argued for no prison time, suggesting house arrest and probation instead. They highlighted Zhao's acceptance of responsibility and his lack of prior criminal history. They further noted that no defendant in a similar case has been incarcerated previously. Defense documents have also outlined a security company's proposal for home detention.

In addition to the criminal proceedings, Zhao has agreed to pay a $50 million fine, a fraction of his reported net worth of approximately $43 billion. If sentenced to more than the recommended 18 months, Zhao retains the right to appeal the decision.

Binance, the world's largest cryptocurrency exchange, which Zhao founded in 2017, has also agreed to pay a hefty $4.3 billion fine. The exchange admitted to evading anti-money laundering requirements under the Bank Secrecy Act, which prosecutors described as a "Wild West" model that facilitated transactions with criminals and designated terrorist groups, including Hamas, al-Qaeda, and Islamic State, as well as supported the sale of child sexual abuse materials and received ransomware proceeds.

The former CEO, who stepped down from his role at the company in November, has been out on a $175 million bond and has agreed not to appeal any sentence that falls within federal guidelines. Moreover, Zhao has already paid $50 million to the Commodity Futures Trading Commission.

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