Binance founder and CEO Changpeng Zhao attempted to shut down Binance.US earlier this year, as regulatory scrutiny intensified, a report from The Information revealed. The move was a clear effort to protect global stock market giant Binance from the growing challenges posed by regulatory agencies in the United States. Here are the details…
Binance CEO tried to shut down BinanceUS
According to two sources familiar with the matter, Changpeng Zhao, commonly known as CZ, has sought to take drastic measures in the face of increasing regulatory pressure on Binance. He believed that closing the US subsidiary could help protect the primary exchange from further complications. But his plans met opposition from Binance USA CEO Brian Shroder. CZ’s intention to shut down Binance US was revealed when he held talks with executives from Gemini and government wealth funds regarding the potential sale of the US-based exchange. Negotiations and discussions have raised concerns among Binance US employees and stakeholders about the future of the platform.
According to one of the sources, the board of directors of Binance.US, chaired by CZ, made a critical vote to decide the future of the company. Last year, Binance US received a significant $4.5 billion valuation from investors, underlining its importance in the US cryptocurrency market. However, the decision on the liquidation of the company required unanimous support from the board of directors, and this support was difficult to obtain. Brian Shroder was the only dissenting voice on the board to oppose the proposed shutdown. Shroder’s concerns centered around the potential harm to Binance US customers if an abrupt shutdown were implemented. He feared that customers would face difficulties in moving or liquidating their crypto assets immediately, potentially causing financial losses.
The exchange is the focus of many regulatory scrutiny.
The attempt to shut down BinanceUS reflects the massive pressure facing cryptocurrency exchanges globally as regulators become increasingly wary of the potential risks associated with the unregulated nature of the industry. Binance has been at the forefront of regulatory attention as one of the largest and most influential exchanges in the world. Changpeng Zhao’s move highlights the complexities and difficult decisions that exchange CEOs must make to protect their operations amid such regulatory challenges.
Some view Zhao’s actions as an aggressive attempt to protect the broader Binance ecosystem. Others may criticize this move as ignoring the interests of BinanceUS clients. Time will tell how Binance and BinanceUS will follow in the ever-evolving regulatory environment. The cryptocurrency industry is facing increasing scrutiny, especially in the United States. Exchanges must proactively address regulatory concerns to ensure a sustainable and harmonious future.
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