US officials announced the agreement with Binance: $4.3 million fine!

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The US fined Binance $4.3 million; CZ announced his resignation; Grayscale and SEC meet to discuss ETF details!

The US fined Binance $4.3 million

US Justice Department officials announced that CZ would plead guilty to a felony charge as part of the deal. 

At the press conference, Attorney General Merrick Garland announced that although CZ resides outside the country, he personally made his defence in US federal court, Garland added that the agreement will be a $ 4.3 billion deal. 

According to Garland, Binance’s policies allowed criminals involved in illegal activities to move “stolen funds” through the exchange. The attorney general also claimed that Binance pretended to comply with the law. 

Using a new technology to break the law makes you a criminal, not a revolutionary!

Garland said, “Binance put profits ahead of the safety of the US public. Using a new technology to break the law makes you a criminal, not a revolutionary.”

Following Garland, Treasury Secretary Janet Yellen said that as part of the deal, Binance would pay more than $3.4 billion in penalties to the Financial Crimes Enforcement Network (FinCEN) and nearly $1 billion to the Treasury Department’s Office of Foreign Assets Control (OFAC).

CFTC chairman Rostin Behnam said that under the proposed settlement, Binance would pay $2.7 billion in civil fines and damages, CZ would pay $150 million and former compliance chief Samuel Lin would pay $1.5 million.

In a blog post dated 21 November, Binance said it was pleased to reach a settlement with the authorities, noting that the exchange has never hesitated to protect users’ security. 

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Binance CEO CZ admitted that he made mistakes and announced his resignation as CEO. The new CEO of the exchange was Richard Teng.

CZ announced his resignation

Changpeng Zhao, founder and CEO of Binance, announced his resignation in a statement on X.

As a result of an agreement between the US Department of Justice and Binance, multiple sources had claimed that CZ would leave his post.

CZ used the following statements in his statement on X:

“I resigned as CEO of Binance today. Undoubtedly, it was not easy to give up emotionally. I know it’s the right thing to do. I made mistakes and I have to take responsibility. This is the best thing for Binance and me.”

Noting that Binance is no longer a “baby”, CZ said it is time to let the company walk and run. 

CZ announced that Binance’s new CEO is Richard Teng.

“I am pleased to announce that Richard Teng has been selected as the new CEO of Binance. Richard is a highly skilled leader and with over three decades of financial services and regulatory experience, he will set the direction for the company’s next period of growth.”

CZ does not plan to serve as CEO again

Speaking about what he will do in the future, CZ said that firstly he will take a break and that he has not turned off his phone for a single day in the last 6.5 years. 

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CZ emphasised that he will probably make passive investments at the moment and that he is happy to have more time to devote to DeFi. 

Noting that he could not see himself as a CEO managing a startup again, CZ shared his satisfaction for being a lucky one-time entrepreneur. 

Finally, CZ mentioned the agreement with US agencies and reiterated that the company has never misused any user funds.

Grayscale and SEC meet to discuss ETF details

Grayscale executives met with the Securities and Exchange Commission to discuss details of the firm’s flagship Bitcoin product, Bitcoin Trust, which the firm intends to convert into a spot Bitcoin exchange-traded fund (ETF).   

In a 20 November SEC note, Grayscale CEO Michael Sonnenshein, chief legal officer Craig Salm, ETF head Dave LaValle and four other executives, along with representatives of the Davis Polk law firm, met with the SEC’s trade and markets division.

The bank will act as agent for Grayscale Bitcoin Trust (GBTC), facilitate the issuance and redemption of shares, and maintain shareholder accounts. 

In a 21 November X (Twitter) post, Seyffart stated that the trading and markets division is responsible for approving 19b-4 filings used to notify the SEC of a proposed rule change by a self-regulatory organisation.

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Seyffart added that Grayscale’s agreement with BNY Mellon is “something that will probably always be necessary” and is not an indication that GBTC will be converted soon. 

“The most important aspect of the SEC meeting with Grayscale is that the GBTC conversion is referred to as a ‘listing’,” TF Store President Nate Geraci said in his X post on 22 November, adding:

“This does not indicate any problems with the conversion to ETF.” 

If Grayscale can list GBTC on NYSE Arca on the day other issuers launch spot BTC ETFs and strive to compete on fees, it has a chance to dominate this ETF category, Geraci said, adding that Grayscale will enter the markets on the first day with a total of $ 20 billion in assets, including BlackRock. 

On 19 October, Grayscale filed an S-3 registration statement with the SEC indicating its intention to list GBTC shares on NYSE Arca under the symbol GBTC. 

In October, a US appeals court ordered the SEC to reconsider its decision to reject Grayscale’s proposal to convert GBTC into a spot ETF.   

The firm is among the major asset managers awaiting SEC approval for spot Bitcoin ETFs, including BlackRock and Fidelity.  

Seyffart argued that “things continue to move forward” and that the ETF is 90 percent likely to be approved by 10 January 2024.

The US fined Binance $4.3 million; CZ announced his resignation; Grayscale and SEC meet to discuss ETF details!