Why even billions in sanctions can’t bring down the world’s largest crypto exchange

  • November 28, 2023
  • 0

Changpeng Zhao has pleaded guilty to breaking US anti-money-laundering laws but will the enforcement end there? Plus, OpenAI’s endless coup

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Binance is guilty. The world’s largest crypto exchange admitted to a range of violations in a massive US court action, including unlicensed money transmitting, sanctions violations and anti-money laundering (AML) violations. Its founder, Changpeng Zhao, near-universally known as CZ, personally pled guilty to his failure to maintain money-laundering controls.

The failures “allowed money to flow to terrorists, cybercriminals, and child abusers through its platform”, the US secretary of the treasury, Janet Yellen, said. From our story:

As part of a guilty plea, Zhao agreed to pay a $50m fine and would be barred from any involvement in the business. Binance too agreed to plead guilty, accept the appointment of a monitor and pay a criminal fine of nearly $1.81bn as well as a $2.51bn order of forfeiture to settle three criminal charges.

Zhao wrote in a tweet: “Today, I stepped down as CEO of Binance. … I made mistakes, and I must take responsibility. This is best for our community, for Binance, and for myself … I can’t see myself being a CEO driving a startup again.”

On March 8, 2022, one of these video-conference meetings was scheduled. Mr Moniruzzaman, now employed by Nvidia, attended the video-conference call… and shared his computer screen during the call. When he minimized the PowerPoint presentation he had been sharing, however, he revealed one of Valeo’s verbatim source code files open on his computer. So brazen was Mr Moniruzzaman’s theft, the file path on his screen still read “ValeoDocs.” Valeo participants on the video-conference call immediately recognized the source code and took a screenshot before Mr Moniruzzaman was alerted of his error. By then it was too late to cover his tracks.

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