Changpeng Zhao, CEO of Binance crypto exchange, pleaded guilty to breaking US anti-money laundering laws in a $US4.3 billion settlement.
Changpeng Zhao, chief executive of Binance crypto exchange, pleaded guilty to breaking US anti-money laundering laws and agreed to step down from his role as part of a $US4.3 billion ($6.6 billion) settlement.
The decision is a culmination of a years-long probe into Binance, the world’s largest cryptocurrency exchange, and comes just weeks after Sam Bankman-Fried, founder of the rival FTX crypto exchange, was found guilty of defrauding customers of an approximate $US8 billion ($12.4 billion).
The investigation found that the exchange broke anti-money laundering laws and sanctions, failing to report more than 100,000 suspicious transactions.
These transactions include those with organisations described by US authorities as terrorist groups, including Hamas and al Qaeda, and with websites facilitating the sale of child sexual abuse materials.
Changpeng Zhao pleaded guilty in Seattle court on Tuesday afternoon.
“Binance made it easy for criminals to move their stolen funds and illicit proceeds on its exchanges,” said U.S. Attorney General Merrick Garland on Tuesday.
“Binance also did more than just fail to comply with federal law. It pretended to comply.”
The exchange was founded by Zhao in 2017 and held a huge stake within the crypto trading market.
Though he would be stepping down as CEO, the agreement would allow him to keep his majority ownership of Binance.
Zhao posted to Twitter (X) announcing his decision to step down, welcoming new CEO Richard Teng, a longtime employee of the company.
He also assured customers that their funds were safe within the exchange.
“On that note, I am proud to point out that in our resolutions with the U.S. agencies they:
“- do not allege that Binance misappropriated any user funds, and
“- do not allege that Binance engaged in any market manipulation,” wrote Zhao.
“Funds are SAFU!”
Zhao is expected to face sentencing at a later date, with the prosecution seeking the maximum suggested prison sentence of 18 months for his part, in addition to the $US50 million paid personally by Zhao as part of the settlement.
