Binance CEO, Changpeng Zhao, Steps Down Amid Legal Troubles
Binance‘s current CEO, Changpeng Zhao, is reportedly signing off and stepping down from his role. The move comes as the crypto exchange faces a $4.3 billion (USD) fine alongside criminal charges from the U.S. government, which forwarded allegations against Binance‘s involvement with violating anti-money laundering laws and sanctions.
Zhao is scheduled to appear in federal court in Seattle to enter a guilty plea tomorrow afternoon (PST). Zhao’s decision to plead guilty, set to be formalized in a Seattle federal court, implies a strategic response on the part of Binance to assuage the U.S. Department of Justice’s (DOJ) intensifying
crackdown on cryptocurrency exchanges
The charges against Binance, which highlight the company’s regulatory challenges, have now culminated into arguably
one of the largest fines in the industry
. Notably, the settlement will be made only between Binance, the Department of Justice, and the
Commodities Futures Trading Commission
, with the
Securities and Exchange Commission
left out of from participating.
The SEC previously charged CZ and Binance sometime in June with operating an unregistered exchange, alongside charges of misleading investors through a Switzerland-based fund Sigma Chain. This charge points to malpractice on the side of the exchange, with the intent of
inflating trading volume for its U.S. platform
“Through thirteen charges, we allege that Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law,” stated SEC chair Gary Gensler.
The fine, a combination of criminal and civil penalties, can be read as a direct consequence of Binance‘s
, which were once key to Binance‘s rapid growth, have led to severe legal repercussions, underlining the risks of non-compliance.
While Zhao’s resignation marks a critical change in Binance‘s leadership, the company’s operational future remains subject to the details of its agreement with the DOJ.
### News source: cryptodaily.co.uk