Crypto
Binance settles with U.S. Department of Justice
November 22, 2023
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The U.S. Department of Justice has reached a settlement with Binance. Binance will pay $4.3 billion as a result of violating sanctions and money laundering regulations. The settlement will allow Binance to continue offering its services. In addition to Binance's settlement, CZ himself has also been fined $50 million, and must leave as top executive.
In an extensive statement(Binance Announcement: Reaching Resolution With U.S. Regulators | Binance Blog), Binance shows contrition for the mistakes they have made in the past and the rules they have broken. Furthermore, the statement mainly refers to the new way of doing business they have implemented. In doing so, they promise transparency, cooperation with lawmakers and a change in leadership.
Following the news of the fine, there were fears that Binance customers would withdraw their funds en masse which could cause Binance problems because they might not have enough liquid assets. Despite customers withdrawing a large portion of their funds, this did not cause any problems for Binance. According to DeFiLlama, Binance holds $67 billion in crypto assets(DefiLlama). This is enough to allow all customers to withdraw their balances and still have some left over.
Although the prices of Bitcoin and others have fallen slightly since the fine was announced, the effects are not nearly as great as when FTX ran into trouble. With a new top executive on the horizon, there may also be hope that Binance will work better with lawmakers, giving consumers more certainty and better protection.
Richard Teng becomes the new CEO of Binance, previously Teng was a regulator in Abu Dhabi and worked as head of regional markets at Binance. In the tweet announcing Teng's new job, he also elaborates on how he envisions Binance's future. The first two points Teng will focus on are strengthening customer trust and working with regulators. There is also a focus on strengthening growth and Web3 adoption.
