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The U.S. government has imposed one of the largest fines ever on Binance, the world’s biggest crypto exchange, for violating multiple laws and regulations. Binance and its founder Changpeng “CZ” Zhao have agreed to pay $4.3 billion and $50 million, respectively, to settle the criminal charges.
Binance was accused of operating an illegal money-transmitting business, failing to prevent money laundering, and breaking sanctions law by serving users from countries under U.S. restrictions, according to court documents. Zhao also pleaded guilty to two charges related to his role in Binance’s misconduct.
Attorney General Merrick Garland said that Binance and Zhao knowingly ignored U.S. laws and put profits over compliance. He said that the $4.3 billion penalty is among the highest ever obtained from a corporate defendant.
As part of the settlement that we reported on yesterday was imminent, Binance will have to appoint an independent monitor for three years and report its compliance efforts to the U.S. authorities. Zhao will also have to step down as CEO and refrain from any involvement in Binance’s operations or management for three years.
Binance said in a blog post that it has worked to restructure over the past few years and has a new leadership team with deep compliance experience. It said that it is confident that Binance will emerge as a stronger company and continue to serve its 150 million users and thousands of employees.
Richard Teng, a former regulator and Binance’s regional markets head, will take over as CEO. He said in a tweet that his focus will be on reassuring users, collaborating with regulators, and working with partners to drive growth and adoption of Web3.
Zhao said that he may engage in passive investing or being a minority shareholder in different projects, as well as explore decentralized finance (DeFi) more.