Binance US Looking To Sell Most Of Changpeng Zhao’s Shares: Report
- Binance US is looking to reduce the number of shares held by founder Changpeng Zhao (CZ).
- CZ has been trying to sell his stake in the company since last summer.
- The effort is said to be aimed at improving the exchange’s reputation with US regulators.
According to The Information, Binance US is working on founder Zhao Changpeng’s strategy to reduce shareholding. Changpeng Zhao has been looking to sell his Binance US holdings since last summer.
Executives at the US branch have considered accelerating CZ’s share reduction in recent weeks, ever since the Commodity Futures Trading Commission sued international crypto firm Binance and CZ for accused of violating US derivatives laws, which could help improve the company’s position in the eyes of US regulators.
The company is worried it may not be able to obtain some of the regulatory licenses it wants in the US while Zhao remains in a critical position, the report added.
In March, the United States Commodity Futures Trading Commission (CFTC) sued Binance and its CEO Zhao for operating what the regulator alleged was an “illegal” exchange and a “fake” compliance program.
“The Commodity Futures Trading Commission today announced it has filed a civil enforcement action in the U.S. District Court for the Northern District of Illinois charging Changpeng Zhao and three entities that operate the Binance platform with numerous violations of the Commodity Exchange Act (CEA) and CFTC regulations. The complaint also charges Samuel Lim, Binance’s former chief compliance officer, with aiding and abetting Binance’s violations.”
In the course of ongoing litigation against the defendants, the agency seeks discord, civil fines, permanent registration, and trading bans, and permanent injunctions for further violations of the laws regulations of the CEA and CFTC, as charged.
Binance said the lawsuit was “unexpected and disappointing,” adding that it had made “substantial investments” over the past two years to ensure that US investors are not active on this platform.
The crypto industry is going through a tough time as tight regulatory constraints threaten the survival of industry service companies. Regulatory actions continued to erupt in early March after the industry lost two of its most significant connections to the mainstream financial world – Silvergate and Signature Bank.
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