Binance Founder CZ to Step Down as U.S. DOJ Secures $4.3 Billion Settlement
Binance founder Changpeng “CZ” Zhao will reportedly step down as CEO of the world's largest cryptocurrency exchange as part of a $4.3 billion settlement with the United States Department of Justice (DOJ).
According to insider sources reported by The Wall Street Journal, CZ has agreed to plead guilty to various charges brought forward by the DOJ, including a criminal violation of Anti-Money Laundering statutes.
Scheduled to appear in a federal court in Seattle later today, CZ is expected to enter his plea, with the reported settlement allowing him to retain his majority stake in Binance. However, the plea bargain stipulates that he cannot hold any executive position within the company.
While the plea deal does not impact the ongoing litigation with the U.S. Securities and Exchange Commission (SEC), which brought a case against Binance in June, it does resolve issues with the Commodity Futures Trading Commission (CFTC).
The $4.3 billion settlement reportedly includes funds allocated to settle the CFTC’s case and outstanding claims against the firm from the U.S. Treasury Department.
The charges against Binance include allegations of failing to maintain an adequate anti-money laundering program, operating an unlicensed money-transmitting business, and violating sanctions laws, according to court filings.
The settlement is expected to be officially announced later today, pending the scheduled press conference by the DOJ featuring key figures such as Attorney General Merrick Garland, Treasury Secretary Janet Yellen, Deputy Attorney General Lisa Monaco, and CFTC Chairman Rostin Behnam.
The resolution of the Binance case marks another significant victory for U.S. authorities against a major player in the cryptocurrency industry, following the recent conviction of FTX founder Sam Bankman-Fried on fraud and conspiracy charges.
The DOJ has been investigating Binance over allegations of permitting individuals from sanctioned countries to operate on its exchange, among other issues. The CFTC filed a lawsuit against the company earlier this year.
In the aftermath of the news, the price of bitcoin (BTC) initially experienced a surge, while Binance’s BNB token witnessed a decline.
Binance is expected to continue to operate.
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