Changpeng “CZ” Zhao, the co-founder of Binance and one of the most prominent people in the cryptocurrency world, is stepping down as CEO of the cryptocurrency trading platform, which received a huge fine from the US government on Tuesday, Business Insider reports.

Zhao’s resignation as CEO of Binance is part of an agreement reached by the crypto company with United States regulators. As part of the same settlement, Binance agreed to pay a total of $4.3 billion in fines for violating the US government’s sanctions regime and anti-money laundering laws.

The Treasury Department in Washington states that Binance failed to report more than 100,000 suspicious transactions involving terrorist groups, fraud, child sexual abuse and ransomware activities.

The Democratic administration in Washington announced in March this year that ransomware cyberattacks would be classified as threats to US national security, rather than just crimes. This decision was taken in the context of a significant increase in these types of attacks against institutional entities.

Among the most serious allegations brought against Binance by US authorities, the crypto platform was used to send money to the Al-Qassam Brigades, the armed wing of Hamas, as well as Islamic Jihad, another Palestinian terrorist organization, and the Islamic State (ISIS).

“CZ”, personally accused by US prosecutors of violating the law

In addition to Binance’s settlement with US authorities on Wednesday, the Justice Department announced that Zhao pleaded guilty to personal charges of violating anti-money laundering laws and will pay a $50 million fine.

The New York Times notes that Zhao faces up to 18 months in prison, but prosecutors are considering seeking a harsher sentence, according to several Justice Department officials.

Binance’s settlement with US authorities on Tuesday is the culmination of investigations launched 5 years ago into whether the cryptocurrency trading platform complied with money laundering laws.

“Binance has become the largest cryptocurrency trading platform in part because of the crimes it has committed. He will now pay one of the largest corporate fines in the history of the United States,” US Attorney General Merrick Garland said on Tuesday.

Binance has announced that Richard Teng, its director of regional markets, will take over as CEO following the resignation of Zhao, better known in the crypto world by the initials “CZ”.

“Binance was growing at an extremely fast pace globally in a new, emerging industry that was in the early stages of regulation, and Binance made some bad decisions along the way,” the company said in a blog post.

A year after the FTX crash, Binance is causing another crypto earthquake

It is not yet clear whether Tuesday’s settlement also ends a lawsuit filed against the company in June by the US Securities and Exchange Commission (SEC), which alleges Binance artificially inflated trading volumes, misappropriated customer funds and misled investors about controls and market surveillance. mechanisms

This lawsuit has shaken the crypto world, as Changpeng Zhao has cultivated for years, both for himself and for Binance, an image of seriousness and trust in investing in the crypto world, known for spectacular ups and downs amid volatility and many scams.

The contrast between “CZ” and other cryptocurrency entrepreneurs seemed to become even more apparent after the collapse of FTX last November and the arrest of its founder, Sam Bankman-Fried.

At the time, FTX was the second largest cryptocurrency trading platform in the world by transaction volume, behind only Binance.

In early November, a US jury found Bankman-Fried guilty on all 7 counts brought against him by federal prosecutors, and the judge in the case set a sentencing date for March 28, 2024.