Binance Agrees to $2.7 Billion Settlement with CFTC

• Binance Reaches $2.7 Billion Settlement with CFTC
• Federal Judge Gives Approval
• Binance Faces Challenges
• Binance Committed to Policy Adjustments
• $4.3 Billion Settlement Over Criminal Charges Against Binance
• Zhao Steps Down

Binance Reaches $2.7 Billion Settlement with CFTC

The leading cryptocurrency exchange, Binance, has finalized a significant settlement deal amounting to $2.7 billion with the Commodity Futures Trading Commission (CFTC). This comes in the wake of accusations claiming that Binance facilitated unauthorized cryptocurrency trades and neglected to enforce effective anti-money laundering protocols.

Federal Judge Gives Approval

A federal judge granted approval to the settlement in December, compelling Binance to disburse a $1.35 billion civil penalty in addition to returning $1.35 billion in alleged improper trading fees generated from U.S. customers. As part of this agreement, Changpeng Zhao, the founder and former CEO of Binance, will personally bear $150 million of the cost.

Binance Faces Challenges

Binance experienced a difficult November as the settlement followed an investigation that revealed Binance had actively pursued business from U.S.-based traders, notwithstanding the knowledge that its cryptocurrency offerings contravened regulations enforced by the CFTC. The agency's statement underscored that Binance, under Zhao's leadership, had actively sought customers in the United States, including quantitative trading firms, to engage in digital asset derivative transactions on the Binance platform.

Binance Committed to Policy Adjustments

As per the consent order, Binance has pledged to implement significant alterations to its corporate governance policies. These changes include the establishment of an independent board of directors.

$4.3 Billion Settlement Over Criminal Charges Against Binance

Just last month, several federal agencies, including the Department of Justice, publicized a collective $4.3 billion settlement regarding criminal charges against Binance related to violations of anti-money laundering and sanctions.

Zhao Steps Down

In the wake of the investigation, Zhao resigned from his position as CEO of Binance and, as of last week, resigned as chairman of Binance.US, the company's U.S.-based trading platform. Although Zhao still holds a financial stake in Binance, he no longer assumes any leadership or governance role at Binance.US, which operates independently from the global exchange.

Edited by Jonathan Stoker