- Binance US founder Changpeng “CZ” Zhao has formally resigned from his position as a board executive member.
- The founder also recently stepped down from his position as Binance CEO.
- The former CEO is in a legal tussle with the U.S Justice Department
The year-long series of challenges confronting cryptocurrency exchange Binance and its now-former CEO, Changpeng “CZ” Zhao, has recently surged following an indictment from the U.S. Justice Department on several criminal charges.
Having admitted guilt to the charges brought against him, the Binance founder finds himself entangled in legal complexities, leading to both mandated and voluntary departures from the exchange.
CZ Steps Down as BinanceU.S Board Chairman
On Tuesday, November 28, the US arm of Binance announced the resignation of Changpeng “CZ” Zhao as a member of its board of executives.
The exchange emphasized its separation from the settlement involving the Department of Justice, Binance, and CZ, stating that it has no “outstanding enforcement matters with the DOJ, FinCEN, OFAC, or CFTC.”
Zhao has transferred his voting rights through an internal proxy arrangement, diminishing his involvement with the exchange to purely economic interests and cutting his participation in its governance.
The development adds an extra layer of uncertainty to the circumstances surrounding CZ as he grapples with the ongoing debacle with the DOJ.
CZ and the Department of Justice
On November 21, Changpeng “CZ” Zhao was indicted by the DOJ on several criminal charges, including the operation of an unregistered money transmitter business and sanctions law violation.
The DOJ alleged that Binance, under the direction of CZ, facilitated millions of dollars in illegal transactions for individuals under U.S. sanctions, including terrorist groups such as ISIS, Hamas, and Al-Qaeda.
Zhao entered a guilty plea deal at the Seattle Federal Court and reached a settlement with the DOJ. As part of the agreement, he was mandated to make his exit from Binance as CEO, as well as pay a staggering $4.3 billion fine.
The former CEO is entangled in a dispute with the DOJ following the prosecutors’ argument that he poses a flight risk and must be detained within the United States until his initial court appearance in February 2024.
On the Flipside
- The voluntary distancing of CZ from Binance suggests that the depth of the charges against him might extend beyond the initial accusations.
- While the charges brought by the DOJ against Changpeng Zhao are significant, he has not been convicted of the crimes.
- The now-former CEO faces a potential sentence of up to 10 years behind bars, but by entering a guilty plea, he retains the right to appeal any sentence longer than 18 months.
Why This Matters
Zhao’s exit from Binance.US signifies the founder’s second exit from Binance and its subsidiaries, ending his influential six-year tenure as a key figure within the exchange.
A former BitMEX executive has criticized US regulators for unjust actions against Binance and CZ. Read more:
EX-BitMEX CEO Condemns US Regulatory Actions Against CZ
Find out more about the DoJ’s request to keep CZ in the United States:
Here’s Why CZ Remains Grounded in the U.S. Despite Bail Bond
Source link: https://dailycoin.com/cz-surrenders-binance-us-voting-rights-as-he-exits-board/
