Binance founder and CEO Changpeng Zhao pleads guilty to felony charges Tuesday related to his failure to prevent money laundering on the crypto exchange platform.
King 5 News Seattle
After pleading guilty to federal criminal charges and stepping down from his post as Binance CEO, Changpeng Zhao on Tuesday named Richard Teng as the new CEO of the cryptocurrency exchange Zhao founded.
Teng, a former CEO of Abu Dhabi Global Market, the UAE capital’s financial services regulator, was most recently global head of regional markets at Binance. He was also previously director of corporate finance at the Monetary Authority of Singapore.
In a post on X, Zhao said he “must take responsibility” and that it was “not easy to let go emotionally.” The controversial crypto entrepreneur, who was accused of violating the U.S. Bank Secrecy Act and sanctions, added that he was “proud to point out” U.S. agencies did not allege Binance had misappropriated user funds or engaged in market manipulation.
The remarks are the first public comments Zhao made after he agreed to a plea deal with the U.S. Department of Justice earlier Tuesday.
“I can’t see myself being a CEO driving a startup again,” Zhao said. “I am content being an one-shot (lucky) entrepreneur.”
“Should there be listeners, I may be open to being a coach/mentor to a small number of upcoming entrepreneurs, privately,” he said. “If for nothing else, I can at least tell them what not to do.”
The case against Binance, which was disclosed Tuesday, shows that three criminal charges were brought against the exchange, including conducting an unlicensed money-transmitting business, violating the International Emergency Economic Powers Act, and conspiracy. The exchange has agreed to $4.3 billion in fines and forfeiture.
Zhao personally pleaded guilty to violating and causing a financial institution to violate the Bank Secrecy Act, according to the plea agreement. The Department of Justice is also recommending that the court impose a $50 million fine on Zhao.
The settlement comes after FTX founder Sam Bankman-Fried was found guilty of several criminal counts of fraud and conspiracy on Nov. 2 following just three hours of deliberation by the jury. Experts told CNBC that, for a high-profile monthlong trial that involved nearly 20 witnesses and hundreds of exhibits, they’d never seen such a speedy decision.
Zhao has been released on a $175 million personal recognizance bond secured by $15 million in cash and has a sentencing hearing scheduled for Feb. 23.
Zhao described Teng as a “highly qualified leader” and added that “with over three decades of financial services and regulatory experience, he will navigate the company through its next period of growth.”
“With CZ, and our leadership team’s support,” Teng said in a post Tuesday on X, “I have accepted this role so that we can continue to meet and exceed the expectations of stakeholders while achieving our core mission, the freedom of money.”
Teng added that his focus will be on three key areas: “reassuring users that they can remain confident in the financial strength, security and safety of the company,” “collaborating with regulators to uphold high standards globally that foster innovation while providing important consumer protections,” and “working with partners to drive growth and adoption of Web3.”
“He will ensure Binance delivers on our next phase of security, transparency, compliance, and growth,” Zhao said.
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