Changpeng Zhao, who started Binance, is no longer allowed to run the company. This was confirmed by the current CEO, Richard Teng.
The ban happened after Changpeng Zhao admitted to helping with money laundering and breaking U.S. laws. Because of this, the U.S. Department of Justice (DOJ) has permanently stopped him from being involved in running the company.
See Also: Binance Exchange Sees Over $1.2B Inflows In a Single Trading Day
What’s The Way Forward For Changpeng Zhao
Even though Changpeng Zhao cannot manage Binance anymore, he still owns 90% of it. This makes him the largest shareholder, giving him a lot of control through his voting rights.
Richard Teng said that Changpeng Zhao can still choose who will be on the board of directors and can even remove the CEO. This means he still has power over key decisions, even though he cannot handle the daily operations.
At the moment, Changpeng Zhao is serving a four-month jail sentence and is expected to be released at the end of September 2024. After his release, he will complete the rest of his sentence in a halfway house before gaining full freedom. However, the ban on him managing Binance will remain in place as part of the deal with the DOJ.
Due to increased pressure from regulators, Binance has made major efforts to follow the rules. In 2023, the company was fined $4.3 billion for breaking laws. Since then, Binance has spent over $200 million in 2024 to improve its ability to follow the rules. The company has also hired two outside experts to ensure it meets all legal requirements and improve control over its operations.
Despite these challenges, Binance is focused on expanding. CEO Richard Teng mentioned that the company plans to get more licenses in other countries and grow its staff. Binance aims to hire 500 more workers by 2025, showing its commitment to growth while following the rules.
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