Binance founder Changpeng Zhao, often referred to as “CZ,” was sentenced earlier this year to four months in prison for facilitating widespread money laundering on the world’s largest cryptocurrency exchange.
In November 2023, Binance and then-CEO Zhao pleaded guilty to money laundering charges for allowing international customers to conduct transactions in violation of US sanctions. As part of a settlement, Binance agreed to pay $4.3 billion in fines, while Zhao agreed to pay a $50 million fine and step down from his role.
Richard Teng, Binance’s regional director and a former Abu Dhabi regulator, has since taken over as CEO. He is implementing significant changes in the firm, including the search for a headquarters location, which contrasts with Binance’s previous stance that a decentralized company does not require an office. This shift may indicate that the crypto exchange is rebuilding itself post-Zhao’s departure.
Do Kwon, co-founder of the crypto company Terraform Labs, is awaiting extradition to the U.S. or South Korea, where he faces potential charges.
Terraform Labs collapsed in 2022, causing a substantial disruption in the cryptocurrency sector. The company’s stablecoin, TerraUSD (UST), was pegged to the cryptocurrency Terra (LUNA), meaning $1 UST was always equivalent to $1 USD of Luna. In May 2022, the value of LUNA crashed from over $120 per coin to nearly zero, leading to a loss of over $50 billion in UST/LUNA market capitalization and triggering a $400 billion crash in the wider crypto market.
The SEC has filed a case against Terraform and Kwon for the deceptive promotion and sale of crypto tokens, particularly the algorithmic stablecoin TerraUSD (UST).
Kwon was arrested in March 2023 for forging travel documents while trying to leave Montenegro. Earlier this year, he agreed to pay $4.47 billion to settle a civil lawsuit filed by the U.S. Securities and Exchange Commission.