Binance, the world's largest crypto exchange, admitted to serious legal violations, including in anti-money laundering, unlicensed money transmitting, and sanctions violations. In the historic settlement, Binance pleaded guilty and agreed to pay over $4 billion to resolve the investigation by the Justice Department. The charges involve violations of the Bank Secrecy Act, failure to register as a money-transmitting business, and the International Emergency Economic Powers Act.
Binance’s CEO, Changpeng Zhao, also pleaded guilty and acknowledged negligence in complying with U.S. laws, prioritizing growth over legal obligations. After the allegations were made, he stepped down as CEO.
Changpeng Zhao tweeted:
"Today, I stepped down as CEO of Binance. Admittedly, it was not easy to let go emotionally. But I know it is the right thing to do. I made mistakes, and I must take responsibility."
To continue its operations, Binance has agreed to retain an independent compliance monitor for three years to ensure their business operations meet regulatory and internal process obligations. It’s also agreed to enhance their anti-money laundering and sanctions compliance programs.
After Zhao’s resignation, more than $1 billion, not including Bitcoin, had been pulled from the exchange within a day. The exchange's liquidity has also dropped by 25% over the same time frame.
Richard Teng was announced as the new CEO shortly after the news came out last week. He has already set out a vision for the exchange to focus on a commitment to regulatory collaboration.
The U.S. SEC has charged Payward Inc. and Payward Ventures Inc., collectively known as Kraken, for operating its cryptocurrency trading platform without proper registration. The SEC alleges that since at least September 2018, Kraken has unlawfully facilitated the trading of crypto asset securities, operating as an unregistered securities exchange, broker, dealer, and clearing agency. The complaint contends that Kraken’s failure to register deprived investors of necessary protections, including SEC oversight, recordkeeping, and safeguards against conflicts of interest. Kraken is accused of engaging in these activities without complying with regulatory requirements.
The SEC also highlights risks to customers due to Kraken’s business practices, deficient internal controls, and poor recordkeeping.
A Bitcoin sender had to pay $3.1 million in transaction fees for Bitcoin (BTC) last Thursday, the largest fee ever paid in its 14-year history. Antpool, a Bitcoin mining pool, was the entity that mined the block containing this high-fee transaction. When miners successfully mine a block, they are rewarded with a certain number of newly created bitcoins as well as the transaction fees included in the block.
The wallet where the transaction was sent from was only created a few minutes before initiating the transfer, and the recipient received only 55.78 BTC out of the 139.42 BTC initially sent.
ARK Invest, led by Cathie Wood, sold a significant number of shares in the Grayscale Bitcoin Trust (GBTC) last week. The total number of shares sold was 163,722, resulting in earnings of $5.02 million at the closing prices.
The sale happened at a time when a discount on GBTC shares decreased to 8.6% on Friday, marking its lowest level since 2021. The discount is attributed to the growing optimism that the U.S. Securities and Exchange Commission (SEC) may approve the spot bitcoin ETF. The sale took the total number of shares this month (November) to 579,077 generating about $16.9 million based on the closing share prices of the relevant days.
Bitcoin, the largest cryptocurrency by market value, experienced an increase in its price last Friday. It reached levels that haven’t been seen since May 2022. It briefly touched the $38,000 mark early on Friday morning and then decreased slightly and sat at around $37,800.
Victory Securities, an investment firm based in Hong Kong, received approval from the Securities and Futures Commission (SFC) to offer crypto services to retail clients. The approval comes after Hong Kong introduced a regulatory regime earlier this year that allows for the offering of crypto services to retail investors.
The Monetary Authority of Singapore (MAS) has issued the final set of responses to feedback on proposed regulations for cryptocurrency service providers. In the announcement, the central bank maintains restrictions on crypto entities to prevent speculation by retail customers. These restrictions include not offering financing, margin transactions, or incentives for trading.
Additionally, the MAS prohibits crypto entities from accepting locally issued credit card payments and emphasizes the need to assess a customer’s risk awareness before granting access to services. This update is part of Singapore’s ongoing efforts to strike a regulatory balance for the crypto industry while attracting businesses. The recent response follows a consultation paper from July, which mandated digital payment token (DPT) service providers to deposit customer assets in a statutory trust by the end of the year for safekeeping.