Binance CEO pleads guilty, steps down and agrees to pay $4.3 bn in fines
Nov 22, 2023, 10:56 IST
Binance Founder Changpeng Zhao (also known as CZ) on Wednesday announced that he will step down as the CEO of the world's largest cryptocurrency exchange, after pleading guilty to federal charges and agreeing to pay $4.3 billion in fines. Binance Holdings Limited (Binance), the entity that operates the world's largest cryptocurrency exchange, Binance.com, pleaded guilty and has agreed to pay over $4 billion to resolve the US Justice Department's investigation into violations.
"Zhao, a Canadian national, also pleaded guilty to failing to maintain an effective anti-money laundering (AML) programme, in violation of the Bank Secrecy Act (BSA) and has resigned as CEO of Binance," the Justice Department said in a statement late on Tuesday.
Richard Teng, Binance's former global head of regional markets, will be the exchange's new CEO, Zhao said in a post on X. "Binance is no longer a baby. It is time for me to let it walk and run. I know Binance will continue to grow and excel with the deep bench it has," Zhao added.
"As a shareholder and former CEO with historical knowledge of our company, I will remain available to the team to consult as needed, consistent with the framework set out in our U.S. agency resolutions," he said.
According to court documents, Binance admitted to prioritising growth and profits over compliance with US law.
Binance was launched in 2017 and focused on attracting high-volume customers. Binance failed to implement controls and procedures to prevent money laundering and also did not implement controls that would have prevented US customers from conducting transactions with customers in sanctioned jurisdictions.
"Binance became the world's largest cryptocurrency exchange in part because of the crimes it committed - now it is paying one of the largest corporate penalties in U.S. history," said Attorney General Merrick B. Garland.
"The message here should be clear: using new technology to break the law does not make you a disruptor, it makes you a criminal," Garland added.
Zhao said in his post on X that he will now do some passive investing, being a minority token/shareholder in startups in areas of blockchain/Web3/DeFi, AI and biotech.
"I can't see myself being a CEO driving a startup again. I am content being a one-shot (lucky) entrepreneur," he posted.
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"Zhao, a Canadian national, also pleaded guilty to failing to maintain an effective anti-money laundering (AML) programme, in violation of the Bank Secrecy Act (BSA) and has resigned as CEO of Binance," the Justice Department said in a statement late on Tuesday.
Richard Teng, Binance's former global head of regional markets, will be the exchange's new CEO, Zhao said in a post on X. "Binance is no longer a baby. It is time for me to let it walk and run. I know Binance will continue to grow and excel with the deep bench it has," Zhao added.
"As a shareholder and former CEO with historical knowledge of our company, I will remain available to the team to consult as needed, consistent with the framework set out in our U.S. agency resolutions," he said.
According to court documents, Binance admitted to prioritising growth and profits over compliance with US law.
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"Binance became the world's largest cryptocurrency exchange in part because of the crimes it committed - now it is paying one of the largest corporate penalties in U.S. history," said Attorney General Merrick B. Garland.
"The message here should be clear: using new technology to break the law does not make you a disruptor, it makes you a criminal," Garland added.
Zhao said in his post on X that he will now do some passive investing, being a minority token/shareholder in startups in areas of blockchain/Web3/DeFi, AI and biotech.
"I can't see myself being a CEO driving a startup again. I am content being a one-shot (lucky) entrepreneur," he posted.