Binance CEO and Ethics Controversy: Busisness and Acconting Implication in The Crypto World

The largest cryptocurrency exchange in the world, Binance acts as a buying and selling platform for thousands of different cryptocurrencies, including Ethereum, Bitcoin, and many more. Changpeng Zhao (CZ) created Binance in 2017. started out in China but eventually expanded to other nations as a result of China's stringent cryptocurrency laws. The founder and CEO of Binance, one of the biggest cryptocurrency exchanges in the world, is Changpeng Zhao, also known by his handle CZ. In 1977, he was born in Jiangsu, China.

Early career: CZ was an engineer at Bloomberg and worked as an engineer for a number of technology startups in Shanghai and Tokyo before getting involved in cryptocurrencies. Following employment at OKCoin, one of the first cryptocurrency exchanges in China, in 2013, interest in blockchain technology grew. Binance, which CZ started in 2017, grew to become one of the biggest and most well-known cryptocurrency exchanges in the world very fast thanks to its creative and user-focused strategy. Obviously! Kindly send me the text that has to be shortened.

An influential person in the cryptocurrency space is Changpeng Zhao. As the CEO and founder of Binance, he has been instrumental in the industry's expansion and advancement. CZ continues to propel the development of blockchain technology and cryptocurrencies with his inventiveness and leadership.

Case chronology

Monday, June 5 2023

The SEC filed a lawsuit against Binance on June 5, 2023. It is alleged that Binance mixed up consumer payments and transferred them to businesses owned by CEO Changpeng Zhao. They were charged by the SEC for endangering the assets of investors and making billion-dollar personal gains. Transaction fees are anticipated to have brought in US$ 11.6 billion for Binance between June 2018 and July 2021. Zhao, Binance Holdings, and two other connected companies, BAM Trading Services and BAM Management US Holdings, are the targets of thirteen legal cases.

Tuesday, June 6 2023

On June 6, 2023, a lawsuit was filed against Coinbase. Coinbase was accused by the SEC of trading thirteen cryptocurrency assets that were deemed securities and ought to have been registered with the regulator beforehand. In contrast to Binance's lawsuit, Coinbase CEO Brian Armstrong was neither named as a defendant by the SEC, nor was the business accused of embezzling user assets. The SEC requested that Binance's US assets be placed under freezing by a federal court in Washington, D.C. Only Binance's two US holding corporations are covered by the freeze order; other platforms are not. Accounts at Axos Bank, Prime Trust, Silvergate Bank (which is no longer in business), and other institutions are included in this freeze.

Wednesday, June 7 2023

However, in a document uploaded by Fox Business journalist, Eleanor Terrett via her Twitter account, it was noted that CZ did not have to appear in person, but needed to provide a response within the specified time frame, namely 21 days.

If there is no response within that time period, then the assessment that will be given against CZ and the company will be carried out by default.

Friday, July 9 2023

US users can no longer buy crypto with USD on Binance starting June 13, 2023. Binance announced late Thursday on Twitter that it blocked US dollar purchases due to a "baseless" SEC lawsuit and informed customers that banking partners will stop cooperating. Binance users won't lose money, and those withdrawing on closing day can convert assets to stablecoins and then back to dollars elsewhere. Of course! Please provide the text you'd like me to shorten.

However, recent developments suggest that Binance's banking partners consider the crypto company too risky to sustain.

Binance informed the SEC that the banks it collaborated with included Axos Bank, Cross Stream Bank, as well as three banks that went bankrupt and were rescued, namely Silvergate, Signature, and Silicon Valley. According to CNBC Worldwide, several of these banks have stopped serving Binance transactions.

Violations of business ethics committed by the CEO of Binance

Anti-Money Laundering (AML) Regulation Violations:

The main allegation is Binance's inadequate Anti-Money Laundering (AML) procedures, leading to loss of trust in financial experts and significant reputational risks for the crypto industry. Binance Property Ltd. pleaded guilty to breaching US anti-money laundering laws. Binance CEO Changpeng Zhao stepped down, and the company will pay a $4 million fine, according to Reuters on November 22, 2023. 3 billion or approximately Rp. 66. $7 trillion and a years-long investigation into the largest crypto exchange resulted in Zhao being fined $50 million. Of course! Please provide the text you'd like me to shorten.

US prosecutors said the fine was one of the biggest fines against a company in US history. This can be another blow to the crypto industry which has been hit by examinations and comes after the later extortion case against FTX author Sam Bankman-Fried. The US Division of Equity said Binance damaged US anti-money washing laws after coming up short to report more than 100,000 suspicious exchanges purportedly connected to Hamas. Separated from that, these exchanges are moreover suspected to have been carried out by fear based oppressor organizations such as Al Qaeda and ISIS. The division moreover said Binance moreover never detailed exchanges with websites pointed at offering child sexual mishandle fabric and was one of the biggest beneficiaries of ransomware continues.

Market Manipulation

There are charges that Binance has controlled the showcase for individual pick up or certain groups."Changpeng Zhao turned Binance, the company he established and ran as CEO, into the world's biggest cryptocurrency trade by focusing on U. "Binance and Zhao's deliberateness infringement of anti-money washing and sanctions laws debilitate the US monetary framework and our national security, and both have presently argued blameworthy. Make no botch: after you put benefit before compliance with the law, you may be held responsible for your violations within the Joined together States.

Conflict of Interest

"Binance's exercises undermined the establishments of secure and sound budgetary markets by purposely circumventing essential and crucial commitments appropriate to trades, whereas collecting roughly $1.35 billion in exchanging expenses from US customers," said Chairman Rostin Behnam of the Product Prospects Exchanging Commission (CFTC) .When, as in this case, an substance goes assist, intentionally maintaining a strategic distance from the utilize of significant get to controls, purposely maintaining a strategic distance from knowing the character of clients, and effectively covering up the nearness of US clients on its stage, there's no question that the CFTC will take solid and forceful activity.

CZ legal case

Previous Binance CEO Changpeng Zhao is within the highlight due to a legitimate claim from U.S. specialists for damaging exchanging and subordinates directions. Binance and Changpeng Zhao confront three criminal charges for damaging US anti-money washing laws and the Worldwide Crisis Financial Powers Act. Of course! It would be ideal if you give the content you'd like me to abbreviate.

CZ was found guilty of inadequate anti-money laundering controls at Binance and received a lighter sentence than the DOJ's proposed three years. Sure! Please provide the text you would like me to shorten.

Arrest of Binance CEO

A government judge has sentenced previous Binance CEO Changpeng "CZ" Zhao to four months in jail for abusing US cash washing laws amid an April 30 hearing. Judge Richard Jones of the S. Area Court for the Western Area of Washington sentenced Zhao to four months in jail. Of course! It would be ideal if you give the content you'd like me to abbreviate.

Prosecutors suggested a three-year sentence for the previous Binance CEO for coming up short to preserve an viable Anti-Money Washing program, to which he argued blameworthy in November. His legal counselor asked probation. Beyond any doubt! If it's not too much trouble give the content you'd like me to abbreviate.

On January 5, 2024, Judge Jones expressed there was no prove that Zhao was mindful of any particular unlawful exercises at Binance, dismissing the prosecutor's ask to amplify his sentence from 18 months to three a long time. Prosecutors argued that Zhao worked on a "absolution instead of authorization" premise and ought to not benefit from his activities. "Detention is basic to reflect the offence's earnestness. A suspended sentence would incentivize others to break the law on a bigger scale," expressed prosecutor Kevin Mosley. Of course! It would be ideal if you give the content you'd like me to abbreviate.

With his official retirement from Binance, CZ is now ready to start a new chapter in his life with a fortune of $60 billion and is the 25th richest person in the world. But what is certain is that Zhao will not return to Binance. The legal agreement reached on November 21 prohibits CZ from participating in any future operational or administrative activities of Binance. In a farewell message on X's social media, CZ said that Binance is no longer a baby. "It's time for me to let it run and run," said CZ.

CZ's future remains uncertain, but some, including prominent investor Tim Draper, hope he will continue to be successful after his release from prison and stick to his mission of building a Bitcoin (BTC)-based economy. Meanwhile, CZ itself has indicated its interest in supporting new projects in the fields of decentralized finance, blockchain technology, artificial intelligence (AI), and biotechnology. Although CZ has no intention of running a new business, he plans to become a passive investor and mentor for young entrepreneurs. He also admitted that he was interested in education.

In March, the company launched Giggle Academy, a free digital platform for children under 13 in developing countries.  The academy offers basic subjects such as mathematics, science, and biology, as well as modern knowledge such as entrepreneurship, finance, blockchain, and AI.  "This project is one of the best ways to have the biggest positive impact on the world." "We want to help children in developing countries get a better education and prepare them to face the challenges of the future." Memories of a career in the cryptocurrency world. While in prison, CZ had a lot of time to think.

On May 12, he hinted at his plans to write a memoir or biography. This was greeted enthusiastically by various groups in the crypto community. One of the most influential figures in the world of cryptocurrency, CZ's story of the journey and rise of Binance is likely to attract the attention of many.  As is known, CZ is one of the leading figures in the world of digital assets, along with big figures such as Satoshi Nakamoto and Ethereum founder Vitalik Buterin.

Author : Ary Irawan & Muhammad Riko Imansyah