Binance.US Severs Ties with Former Chairman CZ After Legal Troubles

Changpeng Zhao Resigns as Chair of Binance.US Board

Key Insights

  • Changpeng Zhao resigns as chair of Binance.US board and exits governance role amid ongoing legal issues
  • Move separates CZ’s influence from US exchange’s oversight as he awaits Feb 2024 sentencing
  • Binance.US states it remains fully operational and not directly implicated by probes into CZ

SAN FRANCISCO β€” Fallout continued for Changpeng “CZ” Zhao after pleading guilty to violating U.S. bank secrecy laws, as the embattled crypto mogul stepped down from the board of directors of Binance.US and exited any governance role at the American exchange.

In an announcement Tuesday, Binance.US stated CZ has formally resigned as chair of its board. He has also transferred away his voting rights via a proxy agreement, retaining only an economic interest rather than any managerial authority.

The move seeks to create clearer separation between the global Binance exchange founded by CZ, and its legally distinct U.S. subsidiary which remains fully operational. It follows CZ paying a $50 million personal fine and admitting criminal liability last week related to flouting anti-money laundering rules.

While no longer directing Binance.US, CZ still awaits formal sentencing in February 2024 on his guilty plea. A Washington federal judge ruled Monday that CZ must remain in the U.S. rather than returning home to Dubai during the interim period as negotiations around his punishment continue.

Read also! U.S. Seeks to Block Former Binance CEO CZ From Leaving Country Amid Flight Risk Concerns

Binance.US emphasized that unlike its former namesake chairman now convicted of criminal violations, the exchange is not a target of any enforcement probes from American regulators. With CZ’s legal troubles casting further shadows, the American crypto trading platform aims to distance itself from association with its tarnished founder.

The question now hangs over the crypto industry whether CZ’s departure from Binance.US governance helps the exchange move towards compliance with U.S. authorities, or if Binance proper can escape the growing reputation of its controversial co-founder.

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