Binance chief executive Changpeng Zhao is stepping down as part of a settlement with the US Department of Justice, according to multiple reports. The Wall Street Journal reports that Zhao will plead guilty to violating anti-money-laundering rules, and the crypto exchange will pay more than $4 billion in fines.
A source with knowledge of the company’s succession plan tells WIRED that Richard Teng, currently head of regional markets at Binance, is likely to take over. Teng was the CEO of Abu Dhabi Global Market, a financial regulator in the UAE. Teng is said to be a popular choice among Binance staff.
Further details are expected to be announced Tuesday afternoon. Forbes also reported details of the settlement. The US Department of Justice (DOJ) has been approached for comment.
Zhao reportedly resides in the United Arab Emirates. Although the country has signed a mutual legal assistance treaty with the US, under which the two countries agreed to exchange information relating to investigations into criminality, there is no formal extradition treaty in place, and it would have been “very challenging” to bring him to court in the US, according to John Stark, a former SEC attorney, speaking before the news of the settlement broke.
In the last year, Zhao had taken to responding to negative headlines on X, formerly Twitter, by posting “4”—a symbol he adopted to dismiss allegations made against the company as baseless FUD (shorthand for fear, uncertainty and doubt). But the DOJ investigation into Binance was an open secret in crypto circles, and Binance insiders say that staff have been anxiously waiting for charges to drop, amid a “general sense of doom.”
Binance is by far the largest cryptocurrency exchange in the world by transaction volume, with around 40 percent of global market share, and is a major part of the infrastructure underpinning the crypto business. The DOJ settlement will reportedly allow Binance to continue to operate in the US, albeit under tighter supervision.
The company also faces two civil lawsuits in the US, brought by the Commodities and Futures Trading Commission (CFTC) and Securities and Exchange Commission (SEC), alleging, among other things, commingling of customer assets, anti-money-laundering violations, and artificially inflating trading volumes.
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