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Zhao Changpeng, founder and chief executive officer of Binance, attends the Viva Technology conference at Porte de Versailles exhibition center in Paris, on June 16, 2022.BENOIT TESSIER/Reuters

Last year, I had a nice, long chat with Changpeng Zhao, founder of the world’s largest cryptocurrency exchange, Binance. We talked about the fault lines that led to Britain’s leaving the European Union. We talked about martial arts. We talked about Game of Thrones (he’d watched only a few episodes).

Most importantly, though, we talked about the spectre of arrest and criminal charges in the United States.

At the time, a Justice Department probe into Binance was reportedly under way, over money-laundering allegations. Media was rife with talk that Mr. Zhao – the world’s richest Canadian, according to the Bloomberg Billionaires Index, with a net worth of US$23.5-billion – was deliberately avoiding American soil.

Whoever came up with that, Mr. Zhao told me over video chat from Paris, was “just a very irresponsible journalist, giving bad narratives, using words like ‘afraid of the arrest’ and stuff like that. That’s just complete bullshit.” He used a slightly different term for excrement to describe a reporter who wrote about the Justice Department probe.

Fast forward to Tuesday, Mr. Zhao pleaded guilty to breaking U.S. anti-money-laundering laws and agreed to step down as Binance chief executive as part of an agreement to settle a Justice Department investigation. The company, agreed to pay US$4.3-billion in that settlement.

I reached out to Mr. Zhao’s people to see if he would talk to me again. I didn’t hear back.

With that guilty plea on Tuesday, Mr. Zhao faces up to 18 months in prison and is barred from any involvement in Binance for at least three years. He joined the swelling ranks of now-condemned hotshot cryptocurrency executives, coming hot at the heels of the conviction of FTX’s Sam Bankman-Fried, a onetime quasi-prodigy of Mr. Zhao.

The U.S. government definitely considers Mr. Zhao to be worse. Mr. Bankman-Fried’s chief crime was stealing users’ money to enrich himself – a personal, base and pedestrian sin of greed.

Mr. Zhao’s sin, on the other hand, is systemic. Binance’s lack of proper anti-money-laundering measures, “allowed money to flow to terrorists, cybercriminals, and child abusers through its platform,” said U.S. Treasury Secretary Janet Yellen. Mr. Zhao arguably caused more damage.

Despite this comparison, Mr. Zhao will likely get off far lighter than Mr. Bankman-Fried. Not only that. While Mr. Bankman-Fried is finished in the crypto world, for Mr. Zhao, this too shall pass.

That’s because Mr. Zhao is a slippery man. Not in the pejorative way, but in the way that underscores resourcefulness, cunning and being in the right place at the right time. In the way that some people can’t help but root for Damien Lewis’s hedge-fund-guy character in Billions.

No, Mr. Zhao hadn’t been to the United States in a while, he told me. But there could be many reasons for not going to various countries, he said. “If you don’t like to travel to North Korea ... or let’s say you don’t like to travel to Africa ... You don’t have to travel to every single place.”

Mr. Zhao’s life is defined by evasion. It began with his father, Shengkai Zhao, who fled persecution in China to move the family to Vancouver. It continued when Mr. Zhao, back in the land of his birth, migrated Binance to Japan when China cracked down on crypto.

“We just said, ‘Look, we can pack up and leave,’” Mr. Zhao said. “We can live anywhere.” And it would continue again.

Japan, Malta, Singapore – Binance set up shop in all of them and then left. The exchange then became a company with “no headquarters” – a point of curiosity and contention in cryptoindustry media. Mr. Zhao himself moved to Dubai.

Mr. Zhao put all this rather matter-of-factly, echoing his noted proclivity of making a move before seeking permission: “My worldview ... if there’s no law against it, it’s legal.” And when that legality comes under question, you recalibrate, he said.

Maybe you’d comply, and maybe you don’t want to, Mr. Zhao said. “When you think it is too strict, and there’s no business to do, then you leave.”

“Borders are imaginary things,” Mr. Zhao said. “Those are man-made rules that are kind of arbitrary.” Binance’s rapid growth to become the world’s biggest exchange reflects how Mr. Zhao has stayed one step ahead of everyone else.

In the United States, considered the world’s most important market but one with tough regulations, Mr. Zhao adopted a plan much bolder than before. According to the Justice Department, Binance publicly set up a U.S. branch with stricter rules, but secretly onboarded customers to its laxer international platform, which was supposed to bar American residents.

In that context, Mr. Zhao’s guilty plea this week was inevitable. An Ultimate Fighting Championship fan, he would know that there’s no such thing as an undefeated pugilist, only retired ones and those who have yet to lose. When you keep fighting, sooner or later you meet your match.

But even if the man had carelessly waged his battles, he has been careful in choosing his sins.

In a public statement, Mr. Zhao made sure to say the authorities “do not allege that Binance misappropriated any user funds, and do not allege that Binance engaged in any market manipulation.” With the subtlety of a bull elephant, Mr. Zhao is saying he’s not Mr. Bankman-Fried.

To many people, that’s a pointless distinction. But Mr. Zhao’s is a true statement. Binance is still standing, and no users have lost any money. (In fact, part of the reason Binance is in trouble is that it treated its users too well, rolling out the red carpet to the U.S. residents it was supposed to bar.) And this makes all this difference in the crypto world.

Mr. Bankman-Fried, essentially a thief and a liar, had broken a bone-deep Old Testament code with which nobody can disagree. Moreover, by stealing users’ money, he committed a crime against crypto.

Mr. Zhao, on the other hand, sinned against government and perhaps even society, but he did not sin against crypto. In fact, he had broken only what many in cryptoland believe to be made-up finance red tape rules that should not exist in the first place.

This distinction, believe it or not, could make somewhat of a difference in the justice system as well.

The apt comparison for Mr. Zhao is not Mr. Bankman-Fried but Arthur Hayes, the convicted American founder of the Hong Kong-based exchange BitMEX.

BitMEX, like Binance, had incurred the wrath of the U.S. Justice Department after it willfully disregarded compliance laws and became a platform used by money launderers. Mr. Hayes walked away with six months of “home confinement” so lax that it allowed him international travel, and then two years of probation.

Mr. Zhao will likely not be in prison for long, if at all. And Binance is still the world’s largest crypto exchange, and Mr. Zhao retains his ownership stake in it.

When the dust settles, and Mr. Zhao readies his second act, the crypto world will talk about him the same way executives talked about Mr. Hayes and his exchange:

“BitMEX never screwed over their clients ... never lost money.”

“He’s not the typical bad actor who embezzled money or stole money or did something really nefarious.”

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