Changpeng Zhao, the chief executive of Binance, has resigned from his post after pleading guilty to charges levelled against him and the cryptocurrency exchange by the US Department of Justice (DoJ).

Zhao pleaded guilty to violating the Bank Secrecy Act (BSA) by failing to maintain an effective anti-money laundering programme, while Binance, the world’s largest crypto exchange, has agreed to pay over $4 billion to resolve the DoJ’s investigation into violations related to the BSA, failure to register as a money transmitting business, and the International Emergency Economic Powers Act.

According to court documents, Binance, which launched in 2017, admitted to prioritising growth and profits over compliance with US law, with Zhao at one point telling employees it was “better to ask for forgiveness than permission”.

The DoJ said Binance’s guilty plea is part of coordinated resolutions with the Department of the Treasury’s Financial Crimes Enforcement Network and Office of Foreign Assets Control and the US Commodity Futures Trading Commission.

“Binance became the world’s largest cryptocurrency exchange in part because of the crimes it committed – now it is paying one of the largest corporate penalties in US history,” said attorney general Merrick B. Garland. “In just the past month, the justice department has successfully prosecuted the CEOs of two of the world’s largest cryptocurrency exchanges in two separate criminal cases.”

He added: “The message here should be clear: using new technology to break the law does not make you a disruptor, it makes you a criminal.”

Taking to X to announce his departure from the company, Zhao said he “made mistakes” and conceded that he “must take responsibility”.

His post to the platform also announced that Richard Teng, global head of regional markets, had been appointed as Binance’s new chief executive.

Changpeng Zhao’s fall from grace comes at a tumultuous time for the cryptocurrency industry.

Sam Bankman-Fried, chief executive of the now-defunct cryptocurrency exchange FTX, was recently convicted on all seven counts relating to fraudulent activity committed by his former company.

The 31-year-old Bankman-Fried, who saw his $26 billion personal fortune evaporate upon FTX’s collapse, could face decades behind bars following his sentencing which has been set for 28 March 2024.

The news also comes after the Securities and Exchange Commission charged Kraken known for operating its crypto trading platform as an unregistered securities exchange.

According to the SEC’s complaint, since at least September 2018, Kraken has made hundreds of millions of dollars unlawfully facilitating the buying and selling of crypto asset securities.

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