The $2.7 billion settlement reached between the U.S. Commodity Futures Trading Commission (CFTC) and Binance has been approved by a judge, and Zhao Changpeng will pay a fine of $150 million.
A U.S. court has formally reached a settlement between digital asset exchange Binance and the Commodity Futures Trading Commission (CFTC), nearly a month after former CEO Changpeng Zhao (CZ) pleaded guilty to charges related to anti-money laundering violations. This marks the end of a case that reverberated throughout the crypto world.
Settlement between Binance and CFTC approved
A federal judge has approved Binance’s previously announced multi-billion dollar settlement with the CFTC.
According to a press release from the CFTC on Dec. 18, the U.S. District Court for the Northern District of Illinois approved the settlement, requiring Binance to pay a $1.35 billion fine to the CFTC and to return a further $1.35 billion in trading fees earned from bad assets. Zhao will have to pay $150 million upfront, one-third of which will be paid within the next 30 days.
CFTZ said Binance “aggressively solicited” U.S. customers at CZ’s direction and helped them circumvent compliance controls by hiding their presence on the trading platform.
As part of the settlement, both CZ and Binance agreed to take additional steps to ensure the exchange follows “know your customer” procedures and require the world’s largest cryptocurrency exchange by trading volume to establish a formal corporate governance structure, including a board of directors, compliance committee, and audit committee composed of independent members.
Binance’s settlement with the CFTC marks the end of months of litigation against CZ and Binance. Earlier this year, Zhao and his exchange were taken to court by the U.S. Commodity Futures Trading Commission (CFTC) for intentionally circumventing U.S. federal law and operating an unregistered derivatives exchange.
On November 21, Zhao pleaded guilty to anti-money laundering violations. As part of a broader settlement with the U.S. Department of Justice, the Treasury Department, and the U.S. Commodity Futures Trading Commission, Zhao also agreed to resign as the head of Binance. Still, the exchange has a pending lawsuit with the SEC, which accused Binance, Binance.US, and CZ of securities violations back in June.
Zhao currently resides in the United States awaiting sentencing in February 2024 after District Judge Richard Jones ordered him to remain in the country because he was a flight risk. The cryptocurrency billionaire could face up to 18 months in prison. #CFTC #币安