Binance CEO Changpeng Zhao to step down as part of $4 Billion Settlement With US DOJ

Binance CEO Changpeng “CZ” Zhao is set to step down from his role as CEO of Binance as part of a substantial $4 billion settlement between the Department of Justice and the cryptocurrency exchange he founded, according to reports from the Wall Street Journal and Forbes.

The settlement, involving the DOJ and Commodities Futures Trading Commission (CFTC), excludes the Securities and Exchange Commission (SEC). As a component of the agreement, Zhao will plead guilty to anti-money laundering charges filed by the Department of Justice, with the plea scheduled to take place in federal court in Seattle.

In June, the SEC charged Binance and Changpeng “CZ” Zhao with operating an unregistered exchange and misleading investors. The charges included utilizing a Switzerland-based fund, Sigma Chain (owned by CZ), to inflate trading volume on Binance’s U.S. platform. SEC Chair Gary Gensler stated, “Through thirteen charges, we allege that Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.”

The CFTC also brought charges, accusing the company of offering crypto derivatives to U.S. citizens without registering as a futures commodity merchant. Bloomberg reported a $4 billion settlement between Binance and the Justice Department, potentially concluding a DOJ investigation into the crypto exchange since at least 2018. In late 2020, federal prosecutors reportedly requested files and messages from Binance related to its U.S. customers.

In September of the previous year, Binance announced the establishment of a Global Advisory Board, led by former U.S. Senator and Ambassador to China Max Baucus. Other members included David Plouffe, former campaign manager for President Barack Obama, and Bruno Bézard, former head of the French Treasury.

Founded in 2017, Binance Holdings Ltd., branded Binance, is a global company that operates the largest cryptocurrency exchange in terms of daily trading volume of cryptocurrencies.

Last year, the Binance CEO was in the news this time last year when he backed out of the deal to buy FTX.

The DOJ is hosting a press conference at 9:00pm WAT (3:00pm EST) and is expected to discuss the Binance suit further.