2023-5-12 10:18 |
Changpeng Zhao, the founder and majority owner of Binance.US, is looking into ways to reduce his company ownership, as per a report by The Information.
According to sources with knowledge of the situation, Zhao has been attempting to sell a portion of his ownership stake since Q2 of last year.
CFTC Lawsuit Reportedly Triggered ActionThe Commodity Futures Trading Commission (CFTC) named CEO Zhao and the COO, Samuel Lim, in a complaint filed in March. Targeting Binance’s U.S. subsidiary, the CFTC lawsuit makes several allegations of infractions and seeks to pierce the corporate veil.
The agency said that Binance.US took advantage of crucial business connections in the country to generate sizable profits. But, the legal action alleges that the exchange and CZ willfully disregarded registration and compliance obligations under US federal law.
Additionally, the CFTC said that Binance, Zhao, and Lim helped American clients while disregarding federal laws. They allegedly utilized virtual private networks to surpass Binance’s geographical constraints. The document also implied that Binance hides its ownership and organizational structure via “a maze of corporate entities.”
The commodities regulator charged Binance, its CEO, and the organization’s former compliance executive. The authorities accused them of engaging in “willful evasion” by exploiting regulatory arbitrage.
According to the report, the exchange’s top executives are debating whether Zhao’s ownership position should be reduced. This would be done to gain favor with U.S. regulators. Zhao’s involvement in the CFTC litigation worries executives at Binance.US. Top bosses reportedly fear that if Zhao stays as the primary owner, the company might not be able to get certain regulatory licenses.
Meanwhile, current and former Binance.US executives are lawyering up against the CFTC action. Former executive Catherine Coley asked James McDonald of Sullivan & Cromwell to represent her in the CFTC’s action against Binance.
Binance Has Criticized the U.S. for RegulationsBinance has recently expressed its struggle to conduct business in the U.S. amid a growing number of legal actions. The company’s Chief Strategy Officer, Patrick Hillmann, said in an interview with the Financial Times that the U.S. has been unclear about the rules. Citing its actions during the past six months, he denounced the government’s crackdown on cryptocurrency.
The executive also used Coinbase’s prosecution by the Securities and Exchange Commission (SEC). Coinbase is suspected of securities law violations. Meanwhile, Hillmann used it to illustrate the condition of the US crypto sector. Meanwhile, Binance wants to be regulated in the UK, according to Hillmann. The exchange considers it a more hospitable location, whereas “the U.S. right now is in this weird place.”
In the meantime, the most recent Exchange Review Report reveals that Binance’s company has recently suffered. In April, Binance’s Spot trading volume fell by 48.1% to $287 billion, making it the second-lowest monthly trading volume since 2021. The research also reveals that Binance’s market share has decreased for the second consecutive month, reaching 46.3%, the lowest level since October 2022.
The post Binance.US Plans to Cut CZ’s Stake to Gain Favor With Regulators: Report appeared first on BeInCrypto.
Similar to Notcoin - Blum - Airdrops In 2024
Binance Coin (BNB) на Currencies.ru
|
