The District Court for the Northern District of Illinois has delivered its final decision regarding Binance, the world’s largest cryptocurrency exchange, and its founder Changpeng Zhao. The court approved a permanent injunction, monetary penalty, and equitable relief against Zhao and Binance. The United States Commodity Futures Trading Commission (CFTC) also announced that the settlement was approved by the court.
It was determined that Binance, under Zhao’s leadership, actively encouraged US customers to engage in digital asset derivative transactions and violated its own terms of use. Binance was found guilty of allowing the opening of “sub-accounts” that were not subject to Know Your Customer (KYC) procedures, primarily by brokers.
Under these allegations, Binance will be required to pay a fine of 1.35 billion dollars to the CFTC. In addition, Binance will pay another 1.35 billion dollars as unjust enrichment fees. Zhao will personally pay a fine of 150 million dollars.
Binance’s former Compliance Director Samuel Lim was also penalized with a separate order. Judge Manish S. Shah ruled that Lim, who participated in activities violating US laws and assisted the exchange’s legal violations, must pay a fine of 1.5 million dollars.
Binance and Zhao will be required to obtain certifications regarding the existence and effectiveness of enhanced compliance controls according to US laws. Continuing without obtaining certification and any detected violations could prevent them from operating permanently in the country.
