Binance CEO Steps Down, Admits Guilt in Court and Gets Released on $175M Bond
The founder of Binance, a major crypto exchange, stepped down after admitting to breaching U.S. anti-money-laundering laws.
Changpeng Zhao pleaded guilty, facing fines totaling $4.3 billion for facilitating trades with sanctioned groups and hiding U.S. users’ locations. This ends lengthy investigations and results in Zhao’s resignation from an executive role.
Binance acknowledged past compliance issues and settled with prosecutors. Zhao knew of millions of U.S. users since 2018 but failed to implement anti-money-laundering measures, leading to significant trades involving American and Iranian users.
Zhao has been released from custody on a $175 million personal recognizance bond.
Attorney General Merrick Garland condemned using tech to evade laws, and while Zhao retains Binance ownership, he can’t hold an executive position. Zhao faces a possible 18-month prison sentence.
Similar to a case involving BitMEX, negotiations between Binance and the Justice Department were arduous. Notably, the settlement doesn’t cover charges from the Securities and Exchange Commission (SEC) but resolves claims from the Commodity Futures Trading Commission (CFTC) and Treasury Department.
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The CFTC accused Binance of lacking anti-terror and money-laundering programs and providing unauthorized derivatives access to U.S. users. Janet Yellen stressed adherence to regulations for U.S. financial system participation.
Although headquartered in Shanghai, Binance operated under Zhao’s guidance from the UAE. The country lacks an extradition treaty with the U.S., favoring crypto despite global regulatory crackdowns. Zhao’s residency factored into negotiations between the UAE government and Binance.
This resolution marks a significant chapter for Binance, once a crypto powerhouse now grappling with regulatory repercussions, impacting its global operations.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
