Binance To Settle with CFTC for $2.7 Billion. The settlement, approved by a federal judge in December, addresses accusations that Binance permitted illicit cryptocurrency trades and inadequately implemented anti-money laundering measures. As part of the agreement, Binance is obligated to pay a $1.35 billion civil penalty and disburse an additional $1.35 billion in allegedly unlawfully obtained trading fees from U.S. customers.
Changpeng Zhao, Binance’s founder and former CEO, will also personally pay $150 million as part of the agreement.
Touch November with Binance – Binance To Settle with CFTC
The settlement stems from an investigation revealing that Binance had knowingly sought business from U.S.-based traders, despite being aware that its cryptocurrency offerings violated CFTC regulations. The agency stated that, under the direction of CEO Zhao, Binance actively solicited U.S. customers, including quantitative trading firms, who engaged in digital asset derivative transactions on the platform. As part of the consent order, Binance has agreed to implement significant changes to its corporate governance policies, which include the establishment of an independent board of directors.
In the previous month, federal agencies, including the Department of Justice, disclosed a combined $4.3 billion settlement concerning criminal charges against Binance, tied to anti-money laundering and sanctions violations. After the investigation, Zhao, the CEO of Binance, stepped down from his position and resigned as chairman of Binance.US, the U.S.-based trading platform of the company. Although Zhao still holds a financial stake in Binance, he no longer holds any leadership or governance responsibilities at Binance.US, which operates independently from the global exchange.