Binance founder Changpeng Zhao, commonly known as “CZ,” was sentenced to four months in prison earlier this year for permitting extensive money laundering on the world’s largest cryptocurrency exchange.
In November 2023, Binance and Zhao, who was then the CEO, admitted to money laundering charges for allowing customers from other countries to engage in transactions that violated US sanctions. As part of the agreement, Binance consented to pay $4.3 billion in fines, and Zhao agreed to pay a $50 million fine and resign from his position.
Since Zhao’s departure, Richard Teng, Binance’s regional director markets head and a former Abu Dhabi regulator, has taken over as CEO. Teng is implementing significant changes within the company, such as searching for a headquarters location, which contrasts with Binance’s previous stance that a decentralized firm does not require an office. This move may indicate to authorities that Binance is restructuring itself post-Zhao.
Do Kwon, co-founder of the crypto company Terraform Labs, who was once a prominent figure in the cryptocurrency world, is currently awaiting extradition to either the U.S. or South Korea, where he could face legal charges.
Terraform Labs collapsed in 2022, which had a profound impact on the cryptocurrency market. Terraform’s stablecoin, TerraUSD (UST), was linked to the cryptocurrency Terra (LUNA), with $1 UST valued equivalent to $1 USD of Luna. However, in May 2022, LUNA’s value plummeted from over $120 per coin to nearly zero, resulting in a loss of over $50 billion in UST/LUNA market capitalization and triggering a crash that wiped out $400 billion from the broader crypto market.
The U.S. Securities and Exchange Commission (SEC) filed a case against Terraform and Kwon concerning the misleading promotion and sale of crypto tokens, particularly the algorithmic stablecoin TerraUSD (UST).
Kwon was arrested in March 2023 for forging travel documents while attempting to leave Montenegro. Earlier this year, he agreed to pay $4.47 billion to resolve a civil lawsuit filed by the SEC.