Rumors that Binance founder Changpeng ‘CZ’ Zhao has been released from prison have taken over across the crypto community. As a result, questions have now been raised about the legitimacy of the speculations.
As a reminder, CZ was sentenced to four months in prison after pleading guilty to money laundering charges during his time as CEO of Binance. His guilty plea included a U.S. a $50 million fine from the US Department of Justice (DOJ).
The Binance Founder Release Rumor
Some X platform users and crypto firms rumored earlier that CZ, initially held at a prison in California known as FCI Lompoc II, had been freed. This has caused misunderstandings and untimely celebrations in the crypto community.
Despite these claims and celebrations, the Binance Founder has not gained his freedom yet. An updated inmate tracker revealed that CZ was only transferred from his prison. He has now reportedly been shifted to RRM Long Beach halfway house in California. Long Beach is not a standard jail but is categorized as a Residential Reentry Management (RRM) field office.
It is managed by the Bureau of Prisons. Federal Inmate Communications Service describes it as a housing facility for offenders nearing their release date.
According to an InmateAID, which is an organisation that aids federal prisoners’ communication requirements, voluntary compliance is the only security in such a set up. However, strict adherence to the rules of the house is observed as per reports.
Technically, this means CZ is still serving his term in prison. X influencers misconstrued the Binance Founder’s prison transfer for release since they expected him to be released on August 30 based on his April 30 sentence. However, he was not truly imprisoned until late May, meaning he still has 38 days left on his sentence.
Although his release date of September 29th comes close, another lawsuit looms for the former CEO.
How BNB is Reacting to CZ’s Sentencing
Binance Coin (BNB), the native cryptocurrency of the Binance exchange, appears to have skyrocketed following the CZ’s release rumor. This may be because the CEO holds a sizable portion of BNB. According to a June report, CZ possessed 94 million BNB tokens, a significant percentage of the circulating supply.
Binance held its first Initial Coin Offering (ICO) in 2017, with 100 million BNB tokens reserved for public sale. The report reveals that the ICO was oversold, meaning the number of people who wished to buy the stock did not equal the number of shares issued.
As of this writing, BNB was trading at $578.8, representing a 6% surge in the past 24 hours. Within the same time frame, the trading volume spiked by 12% to over $2 billion. BNB now ranks as the fourth largest cryptocurrency by market capitalization, at $84.4 billion.
The release of Changpeng Zhao might be considered a very bullish event for digital currency. Although the exchange has had a major growth trend since the founder went to prison, his release might spark an unusual rally. Judging by the spike BNB notched with the CZ release rumor, his actual release might trigger a return to its previous ATH of $720.
