The Northern District Court of Illinois has delivered its final decision regarding Binance, the world’s largest cryptocurrency exchange, and its founder Changpeng Zhao. The court approved and implemented a consent order containing a permanent injunction, monetary penalties, and equitable relief against Zhao and Binance. The U.S. Commodity Futures Trading Commission (CFTC) also announced that the agreement was approved by the court.
Binance and Zhao were found to have violated the Commodity Exchange Act (CEA) and CFTC regulations, with Zhao’s leadership actively encouraging U.S. customers to engage in digital asset derivative transactions and violating their own terms of use.
It was determined that Binance knowingly concealed the presence of U.S. customers on the platform by allowing the opening of “sub-accounts” that were not subject to KYC procedures.
Under these allegations, Binance will have 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 transaction 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 assisted and abetted the cryptocurrency exchange in violating U.S. laws and engaged in activities outside the U.S. that violated U.S. laws, must pay a fine of 1.5 million dollars.
