Top Lawyer Highlights Difference Between Binance and FTX Legal Woes
During a recent live stream, XRP lawyer John Deaton discussed the implications of Binance settlement with the U.S. government, highlighting how the case differs from the FTX’s saga.
It is common knowledge that Binance, the world’s largest cryptocurrency exchange by 24-hour trading volume, pleaded guilty and agreed to pay a $4.3 billion settlement to the U.S. government for violating the Bank Secrecy Act.
As part of the settlement, Binance founder Changpeng Zhao “CZ” also stepped down as the exchange’s CEO and chairman of the board of Binance.US.
In addition to Binance settling with the United States government, CZ faces up to 18 months in prison for failing to maintain an effective money laundering measure while he was CEO.
Not the End of Binance
Commenting on the development, prominent XRP lawyer John Deaton noted that the Binance settlement will help move the crypto industry forward.
Interestingly, Attorney Deaton emphasized that Binance’s settlement deal would not be the end of the exchange. According to him, the outflow from Binance following CZ’s resignation was way lower than the figure recorded last year when FTX collapsed.
Data from Dune Analytics show that over $2.37 billion worth of crypto was withdrawn from the exchange after CZ’s resignation. Conversely, users deposited $1.78 billion within this period.
At press time, Binance holds a whopping $67.47 billion worth of customers’ assets, thus easing concerns about a bank run.
Distinction Between Binance and FTX Cases
Meanwhile, Deaton also shed light on the distinction between the Binance and FTX cases. Unlike the FTX saga, Attorney Deaton said the U.S. authorities, including the DoJ, FinCEN, and CFTC, never found that Binance misappropriated customers’ funds even after going through the exchange’s balance sheet.
“It appeared that the money was there. This isn’t the FTX situation, people,” Deaton remarked during his latest CryptoLaw livestream.
Binance Bows Out: Settlement Implications https://t.co/UMFzqROD5g
— CryptoLaw (@CryptoLawUS) November 28, 2023
Furthermore, Attorney Deaton emphasized that Binance’s legal woes are different from what happened at FTX, where the founder misappropriated customers’ funds to acquire real estate properties and finance political campaigns.
Per Deaton, Binance only pleaded guilty to violating the Bank Secrecy Act and not reporting suspicious transactions during its early days.