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24 June, 2024

Investors pull $956M from Binance after CEO resigns amid legal woes

US authorities allege that Binance failed to report over 100,000 suspicious transactions


In the aftermath of Binance CEO Changping Zhao's resignation and guilty plea, investors withdrew approximately $956 million from the cryptocurrency exchange within the last 24 hours. Zhao, who pleaded guilty and settled with US authorities, will be replaced by Richard Teng, a senior Binance executive since 2021.

Binance has agreed to pay a substantial $4.3 billion to US authorities, casting uncertainties over the future of the world's largest cryptocurrency exchange.

US authorities allege that Binance failed to report over 100,000 suspicious transactions, including dealings with organizations such as Hamas, al-Qaeda, and the Islamic State of Iraq and Syria. Additionally, the exchange neglected to report transactions involving child pornography sites, despite being a major recipient of ransomware revenue.

The Securities and Exchange Commission (SEC) is adding pressure, accusing Binance of illegal operations in the US and misusing customer funds. Another setback emerged in late August when the Wall Street Journal published an article detailing Binance's cooperation with sanctioned Russian banks.

Zhao, currently residing in Dubai, pleaded guilty in a Seattle court on Tuesday, agreeing to a $50 million fine. He faces a maximum sentence of 18 months in prison under federal authorities.

[Source: Reuters]

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