According to a recent Fortune Magazine report, Binance, the world’s largest cryptocurrency exchange, faces a major crisis as senior executives resign over CEO Changpeng Zhao’s (CZ) response to the Department of Justice (DOJ) investigation.
The company has been under immense regulatory pressure for months, with investigations into alleged money laundering, sanctions violations, and attempts to deceive U.S. regulators.
CZ’s Leadership Under Fire As Binance Senior Executives Depart
Fortune has learned that Binance’s general counsel Han Ng, chief strategy officer, Patrick Hillmann, and Senior Vice President (SVP) for compliance Steven Christie have all resigned.
This follows the recent departure of Matthew Price, a former Internal Revenue Service (IRS) agent hired by the exchange in 2021 to oversee global investigations and intelligence.
The exodus of senior figures from Binance comes when the company grapples with lawsuits filed by the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).
The DOJ investigation, allegedly ongoing for over a year, is said to focus on Binance’s attempts to deceive U.S. regulators and alleged money laundering and sanctions violations.
The departures of key executives from Binance’s legal and compliance units are expected to increase regulatory pressure on the company, given that these units deal most directly with regulators.
Furthermore, the company has been rumored to consider several options in the face of mounting regulatory pressure. Richard Teng, a fast-rising executive with experience, is touted as a possible successor to Zhao. However, Zhao has not indicated that he is willing to step aside, despite the company’s recent turmoil.
Given these developments, Binance’s market share has begun to slide in recent months, likely due to the regulatory pressure and the decision by banks in the U.S., Europe, and elsewhere to sever ties with the company. The company’s future is uncertain, with rumors of an imminent criminal complaint by the DOJ against Binance and Zhao.
In summary, the company faces a major crisis as senior executives resign over the company’s response to a DOJ investigation. The departures of key figures from Binance’s legal and compliance units significantly blow the company’s management and strategic stability.
Despite the recent exodus of senior executives from the exchange over the company’s CEO’s response to the DOJ investigation, the company has not yet responded.
Featured image from Unsplash, chart from TradingView.com