The US Department of Justice (DOJ) is demanding a $4 billion settlement as part of its plans to drop all charges against Binance.
Let’s discover more about this important news for Binance.
Can Binance Operate Again Paying $4 Billion to the DOJ?
Despite months of investigation by the DOJ into Binance and its CEO, Changpeng “CZ” Zhao, the department now appears receptive to an out-of-court settlement.
According to some sources, Binance has been in talks with the DOJ to settle cases involving financial fraud, sanctions violations, and money laundering. If finalized, the $4 billion settlement will rank among the biggest in the cryptocurrency sector.
Analysts pointed out that the DOJ’s criminal investigation of Binance and CZ is one of the biggest difficulties facing Binance and even the crypto industry. In contrast, the SEC and CFTC are all civil lawsuits. This settlement means that Binance and the crypto industry have… https://t.co/9EgHpaN919
— Wu Blockchain (@WuBlockchain) November 21, 2023
Furthermore, if an agreement is reached, the $4 billion payment would be part of a deferred prosecution settlement. The exchange would also need to meet certain criteria. This includes updating its compliance programs. The DOJ allegedly pushed for an overhaul of leadership at Binance. However, there’s no clarity if regulators will charge other Binance executives aside from CZ.
The exchange has not enjoyed a rosy relationship with US regulators. And things intensified this year. The crypto exchange was charged with operating in the US without a license and choosing a less transparent policy. Several reports emerged a few months ago linking Binance to the Chinese government. However, the exchange denied such ties.
In addition, the Department of Justice has been investigating whether Binance violated US sanctions on Iran and Russia by enabling users from those countries to transact on its exchange.
#Bitcoin is slowly approaching the #resistance area once again. There are some #FUDs about #Binance needing to pay $4 billion to the US to settle criminal cases. This news may result in a quick sell-off in the market, so it's better to use a tight stop loss. pic.twitter.com/LwtcT6nTyT
— Crypto VIP Signal™ (@CryptoVIPsignal) November 21, 2023
US Investigates Crypto Platforms
Washington has increased its scrutiny of crypto platforms and their executives. This comes after multiple claims of crypto exchanges being used to facilitate terrorism financing. Concerns about crypto exchanges worsened after Hamas attacked Israel in early October. Authorities shut down several Binance accounts linked to the group. Afterward, US Senator Cynthia Lummis urged the DoJ to “reach a charging decision” over Binance.
Other US regulators, including the SEC and the Commodities and Futures Trading Commission, are also pursuing legal actions against the exchange. The exchange was sued in March by the CFTC, which claimed it had gained unauthorized access to US investors.
SEC gets Binance to pay off the $4 billion bribe (smart move by Cz and company)
Then they immediately go after Kraken 🤦♂️
Corruption of the highest order!!!
— Nick Hellmann (@CryptoHitmann) November 20, 2023
The CFTC claimed in its lawsuit that a Binance executive had stated in 2020 that some of their customers were “here for crime.” According to reports, a coworker responded, “We see the bad, but we close two eyes.”
The SEC filed charges against Zhao and various Binance-affiliated companies in June. In addition, the SEC accused the exchange of an “extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.” The SEC also said that Binance had commingled billions of dollars worth of customer funds with another trading company that Zhao owned.
#BNB dropped from$300 on the US investigation news
It almost at the same level today
How is this news Bullish, I have no clue
Its $4 Billion fine in a illiquid market
— Tycoon (@Tech_Tycoon) November 20, 2023
The exchange has denied all charges. But its US affiliate has taken a huge hit from these accusations.
Should Binance Pay the $4 Billion?
The details of the negotiations are still sketchy. However, several crypto experts have given their say on the matter. Some believe that if Binance agrees to the $4 billion payment, the exchange will admit wrongdoing.
If you did nothing wrong why pay them a dime? If Binance is willing to pay $4 Billion, how big is the real problem? https://t.co/J3O7NPpK6J
— THE PARZIVAL (@The1Parzival) November 20, 2023
One Twitter user painted a possible narrative. The user claimed that US lawmakers would arrest CZ. The exchange would appoint a new CEO to continue its operations. Close sources revealed that the settlement is part of an arrangement to avoid a Binance collapse, which would utterly affect the crypto market.