Cryptocurrency exchange Binance to pay $2.7 billion to settle claims in the US

Cryptocurrency exchange Binance to pay $2.7 billion to settle claims in the US

The fine is the result of the exchange allegedly operating in the US without proper licenses

A US court has ordered cryptocurrency exchange Binance and its former CEO, Changpeng “CZ” Zhao, to pay $2.7 billion to settle claims it violated US monetary regulations. CZ must also pay $150 million to the Commodity Futures Trading Commission (CFTC).

The CFTC announced on December 18 that the US District Court for the Northern District of Illinois had authorized the settlement, ending the enforcement measure first handed down by the agency in November.

“The court finds Zhao and Binance violated the Commodity Exchange Act (CEA) and CFTC regulations, imposes a $150 million civil monetary penalty personally against Zhao, and requires Binance to disgorge $1.35 billion of ill-gotten transaction fees and pay a $1.35 billion penalty to the CFTC,” said the CFTC in a written statement.

The settlement denotes the end of the case against CZ and Binance by the CFTC, which sued him and the exchange on March 27 for evading federal law and running an illegal exchange to sell derivatives.

As part of a broader settlement with the US Department of Justice, the CFTC, and the Treasury Department, CZ agreed to resign as Binance CEO on November 21, the same day he pled guilty to various civil charges and a criminal charge connected to Anti-Money Laundering rules.

CZ was ordered to stay in the US until his sentencing on February 23, 2024, and is facing up to 18 months in prison for money laundering under the condition that he not appeal any potential sentence given up to that level.

In a separate order, former chief compliance officer at Binance, Samuel Lim, was ordered to pay $1.5 million in civil monetary damages for “aiding and abetting Binance’s violations and engaging in activities outside of the US to willfully evade or attempt to evade US law.”

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