Binance founder Changpeng “CZ” Zhao is set to step down as CEO as part of a $4.3 billion settlement with the U.S. Department of Justice (DOJ). The Wall Street Journal reports that CZ will plead guilty to several charges during a federal court appearance in Seattle. Although the deal allows him to retain his majority stake, he will be barred from holding an executive position in the company.
Guilty Plea and Legal Charges for Binance Founder
Forbes initially broke the news, citing sources close to the discussions between Binance and the DOJ. The settlement, involving both the DOJ and the Commodities Futures Trading Commission (CFTC), excludes the Securities and Exchange Commission (SEC).
In June, the SEC had previously charged the exchange and CZ for operating an unregistered exchange and misleading investors. The charges included allegations of deceptive practices, conflicts of interest, lack of disclosure, and intentional evasion of the law. The CFTC also accused the company of offering crypto derivatives to U.S. citizens without proper registration.
The exchange’s settlement, rumored to be around $4 billion, marks the conclusion of a Justice Department investigation that dates back to at least 2018. Federal prosecutors had reportedly requested customer-related files and messages from Binance in late 2020.
This development comes on the heels of Binance’s strategic moves, including the formation of a Global Advisory Board last September. Led by former U.S. Senator Max Baucus, the board includes notable figures like David Plouffe, former campaign manager for President Barack Obama, and Bruno Bézard, former head of the French Treasury.
However, the crypto community awaits further details on the settlement and its implications for Binance, one of the world’s largest cryptocurrency exchanges.
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