The US Securities and Exchange Commission (SEC) is actively investigating whether Changpeng ‘CZ’ Zhao still retains access to user funds on Binance US. This inquiry follows CZ’s recent plea of guilty to criminal charges brought by the United States Department of Justice (DOJ) and his subsequent resignation as the CEO of Binance, as part of a settlement that included his release from jail on a $175 million personal recognizance bond. The charges CZ faced were related to the alleged failure to implement an effective anti-money laundering system.
Despite these developments, the SEC is now focused on determining if there is any indication that CZ might still have a ‘backdoor’ access to Binance US assets. This ongoing scrutiny by the SEC highlights the regulatory concerns surrounding CZ’s potential influence or control over user funds even after stepping down from his executive role. The SEC is working to collect evidence related to CZ’s continued access to the Binance US fund.
In June 2023, the Securities and Exchange Commission (SEC) took legal action against Binance, accusing the platform of operating a securities exchange unlawfully. Concurrently, the SEC initiated an investigation into the possibility of a collapse reminiscent of the FTX fallout in November 2022. Earlier reports by AZC News featured expert opinions suggesting that the SEC might possess new evidence against Binance, reinforcing their stance in the lawsuit.
Related: Ex-Binance Chief Changpeng Zhao Faces Potential Decade Behind Bars
Coinciding with Binance’s legal challenges is the contrasting success of its primary competitor, Coinbase. On November 27, 2023, the stock price of $COIN surged to approximately $121, marking a new peak since May 22, 2022.
In the aftermath of Changpeng ‘CZ’ Zhao’s guilty plea and resignation as CEO, the newly appointed CEO, Richard Teng, has committed to bolstering regulatory compliance. This shift represents a departure from CZ’s leadership approach, as Teng expresses a desire to collaborate closely with regulators globally and cultivate a reputation built on trust.
The future trajectory for Binance remains uncertain amidst the legal turmoil and changing leadership, with the company navigating challenges and seeking to rebuild trust in the regulatory landscape.
