Binance to Pay $4.3 Billion in Fines and Founder to Resign in Agreement with US Authorities
The largest cryptocurrency exchange platform in the world, Binance, has reached an agreement with US authorities that will see the company pay fines of about $4.3 billion and its founder, Changpeng Zhao, resign from directing the firm. This comes as part of an agreement aimed at ending complaints against Binance by the US authorities.
According to The Wall Street Journal, the agreement also includes Changpeng Zhao pleading guilty to violating anti-money laundering laws in the United States. The news was reported by the financial newspaper, which cited anonymous sources familiar with the matter.
The legal troubles for Binance began in March 2023 when the US Commodity Futures Trading Commission (CFTC) sued the cryptocurrency trading platform and its president for violating money laundering legislation. The lawsuit was filed in federal court, accusing Binance and its executives of selling products to American customers without adhering to financial regulations in the United States.
The cryptocurrency sector has been marred by scandals, including hacks, thefts, and market crashes. Despite this, the sector reached a valuation of over $3 trillion last year due to the promotion of complex products by celebrities. However, the bubble eventually burst, leading to the bankruptcy of the FTX platform and the indictment of its leaders.
Changpeng Zhao made headlines in March 2022 when he visited El Salvador and met with President Nayib Bukele to discuss investments in Bitcoin. In April of that year, Zhao announced via Twitter that Binance would create jobs for young Salvadorans, but there has been no further information about the jobs to date.
The resignation of Binance’s founder and the hefty fines paid by the company mark a significant development in the regulatory landscape for cryptocurrency exchanges and could have broader implications for the industry.