✔️ Information reviewed and updated in May 2024 by Eduardo López
The cryptocurrency world is shaken by the news of the guilty plea and resignation of Changpeng Zhao, the CEO of Binance, after reaching an agreement with the United States Department of Justice. This unexpected turn has left the financial community in suspense, and many are wondering how this situation came to be. Below, we will explore nine crucial facts to fully understand this amazing event.
1. The Agreement in Progress for Months
During the process of the lawsuits filed by the SEC and CFTC against Binance, Changpeng Zhao publicly showed optimism on his social networks, responding to criticism with phrases such as “4” and “FUD.” However, throughout this year, his statements changed, indicating a possible amicable agreement with regulators.
2. Three Criminal Charges: The Settlement Price
The settlement, revealed after negotiations with the CFTC, FinCEN and OFAC, includes three criminal charges against Zhao. Among them are admissions to allowing terrorist groups to conduct operations, instructing US citizens to evade KYC regulations, and running a fund in Switzerland to inflate the platform's trading volume.
3. Zhao Takes Personal Responsibility
To avoid further consequences for Binance, Zhao takes personal responsibility and admits mistakes. The sanction includes the payment of USD 50 million to avoid a long prison sentence. Although the company remains operational, the repercussions fall on the image of the former CEO.
4. Operations Continue with New CEO
Despite Zhao's resignation and the fine, Binance continues to operate under the direction of Richard Teng, the new CEO. Analysts suggest that, with a fine below USD 10 billion, the consequences have not strongly affected the platform, keeping it among the main exchanges.
5. Reservations and Rigorous Supervision
Binance will not sell its reserve crypto assets to pay the fine, demonstrating that it has the economic capacity to face it. However, the company will face strict supervision with the appointment of inspectors who will review its business practices and its interaction with countries subject to sanctions.
6. Changpeng Zhao's Continuing Role
As founder, Zhao will remain a shareholder and human resource for consultation on historical areas of the business. His resignation comes as a necessary pause, and he is willing to mentor future entrepreneurs.
7. Impact on the Market and Resilience
Despite initial concerns about a possible “black swan” in the cryptocurrency market, the reaction has been surprisingly resilient. BTC has maintained its price around $36,000, with BNB, Binance's token, experiencing a drop but not significantly affecting the market.
8. Whitening of the Ecosystem?
It is hypothesized that the actions of the US authorities could be part of a “cleansing” process of the cryptocurrency ecosystem, similar to the departure of prominent figures from other platforms. Is this a step towards greater regulation and institutional acceptance?
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