Business Deterioration After Intense US Regulatory Scrutiny
Binance's New CEO Is Richard Teng
Zhao Changpeng, founder and CEO of Binance, the world's largest cryptocurrency exchange, has pleaded guilty to money laundering charges and other allegations in a U.S. court and will step down as CEO, the Wall Street Journal (WSJ) reported on the 21st (local time).
According to the media, CEO Zhao appeared at the Seattle Federal Court in the afternoon, pleaded guilty, and is scheduled to pay a fine of $4.3 billion (approximately 5.5 trillion KRW).
In exchange for his guilty plea, he will retain his status as the largest shareholder of Binance. However, he is expected to resign from his position as CEO.
Following Zhao's resignation, Richard Teng, head of Binance's operations outside the United States, is reported by Bloomberg to take over as the new CEO and lead the company.
Previously, the U.S. Department of Justice had been investigating Binance since 2020 for allegations of money laundering, bank fraud, and sanctions violations. The U.S. Securities and Exchange Commission (SEC) filed a lawsuit in June accusing Binance of mismanaging customer funds, misleading investors and regulators, and violating securities laws. The U.S. Commodity Futures Trading Commission (CFTC) sued Binance in March for failing to properly report derivatives and other products. Binance is also under investigation for allegedly aiding Iran and Russia in evading U.S. sanctions.
Zhao's decision to plead guilty and step down comes after intense scrutiny from U.S. regulators, which has rapidly deteriorated Binance's business. Earlier this year, Binance accounted for 70% of global cryptocurrency trading, but its market share has now dropped to 40%. Binance's share of the U.S. cryptocurrency market has fallen from the 20% range to about 0.5%.
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