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Binance Founder Changpeng Zhao Steps Down as CEO and Pleads Guilty in $4 Billion Settlement

The charges against Binance and Zhao involve operating an unregistered exchange, misleading investors, and utilizing a Switzerland-based fund to inflate trading volume. 

Zhao Pleads Guilty to Anti-Money Laundering Charges

In a shocking turn of events, Binance CEO Changpeng "CZ" Zhao announced his resignation from the cryptocurrency exchange following a $4 billion settlement with the Department of Justice (DOJ) and the Commodities Futures Trading Commission (CFTC). This significant development is part of a plea deal that includes anti-money laundering charges brought by the DOJ against Zhao, according to a report from The WallStreet Journal.

Sources close to the discussions reveal that Zhao's resignation is a key component of the multi-billion dollar settlement, a monumental agreement that excludes the Securities and Exchange Commission (SEC). As part of the settlement, Zhao will plead guilty to anti-money laundering charges, and the plea is scheduled to take place in federal court in Seattle on Tuesday afternoon.

The DOJ charges against Binance come five months after the SEC filed 13 charges against the exchange and Zhao, accusing them of providing crypto-related services to Binance.US while allegedly lying to regulators about its independence.

According to the SEC, Binance misled investors by utilizing Sigma Chain, a Switzerland-based fund owned by Zhao, to inflate trading volume on Binance's U.S. platform. SEC Chair Gary Gensler accused Zhao and Binance of engaging in a web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.

Amidst the leadership transition, Richard Teng, Binance's head of regional markets outside the U.S., is reportedly under consideration to assume the CEO role. 

This seismic event follows the SEC's recent charges against Kraken, the third-largest crypto exchange, for allegedly operating as an unregistered securities exchange, broker, dealer, and clearing agency.

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