Federal judge gives the green light to settlement between CFTC and Binance
A settlement between crypto exchange Binance and the Commodity Futures Trading Commission (CFTC) has been approved by a federal judge, following the guilty plea of Binance’s former CEO to charges related to anti-money laundering violations. As part of the settlement, former CEO Changpeng Zhao will be required to pay $150 million, with a third of that amount due within 30 days. The CFTC will also impose a $1.35 billion penalty on Binance and require the exchange to disgorge $1.35 billion of “ill-gotten transaction fees.” The CFTC stated that Binance, under Zhao’s direction, knowingly solicited U.S. customers and deliberately ignored U.S. regulations. In addition, the settlement mandates that Binance and Zhao establish a corporate governance structure, including a board of directors with independent members, a compliance committee, and an audit committee.
This settlement follows multiple federal agencies, including the CFTC, Treasury Department, and Justice Department, announcing a record-setting $4.3 billion corporate settlement in November. Zhao pleaded guilty to anti-money laundering and sanctions violations after a lengthy investigation by federal regulators. Furthermore, as part of his withdrawal from Binance.US, Zhao resigned as chairman of the board of directors, effectively eliminating his influence in the exchange’s U.S. arm and reducing his involvement to solely economic interests.