- Binance CEO Changpeng “CZ” Zhao has resigned as part of a plea deal with the DOJ.
- The news has rocked the crypto markets, leading to broad price declines.
- Still, many remain optimistic that the resolution of Binance and Zhao’s criminal charges is good for crypto.
Late on Monday, November 20, crypto asset prices jumped as industry participants expressed excitement at the possible resolution of the DOJ’s (Department of Justice) criminal investigation into Binance. However, as stunning details of the settlement deal unfolded on Tuesday several of these assets are retreating, with Binance’s BNB leading the charge.
Crypto Market Reacts to Binance CEO CZ’s Resignation
On Tuesday, November 21, the U.S. DOJ unsealed its indictment of Binance and its CEO Changpeng “CZ” Zhao, revealing that the crypto exchange and its founder had pleaded guilty to violations of the Bank Secrecy Act and U.S. sanctions and failing to register as a money transmitter business in the U.S. The indictment revealed penalties of up to $4.3 billion as part of a settlement deal that would see the exchange completely exit the U.S. confirming Bloomberg’s Monday report.
For many, however, the shocker was the revelation that Zhao would step down as CEO of the firm as part of the plea deal. Crypto asset prices have taken a dive following the revelation.
Binance’s BNB has completely erased its Monday gains to trade 4.68% lower over the past 24 hours at $242.25, per CoinMarketCap data at the time of writing. Other popular crypto assets like Bitcoin, Ethereum, XRP, and Solana are also down 1.31%, 1.63%, 2.61%, and 4.75% in the past 24 hours.
Despite the recent price declines, several industry participants maintain that the resolution of Binance’s criminal charges bodes well for the crypto markets.
Is the Resolution of Binance’s DOJ Case Bullish?
The looming threat of criminal indictments against Binance, the world’s largest crypto exchange, had weighed heavily on the market. As a result, industry participants have hailed the recent resolution of these charges as good news, given that they allow the exchange to continue to operate with minimal impact on the market and harm to customers.
Citing analysts, independent reporter Colin Wu, contended that the resolution of the case eliminated the biggest obstacle to the next crypto bull run.
Despite the broadly positive outlook from many market observers, at the time of writing, DefiLlama’s CEX transparency page shows Binance has weathered $913 million in outflows in the past 24 hours.
Aside from footing a massive $4.3 billion bill, the firm faces the huge task of combating a lingering legal battle with the SEC and growing under new management and supervision from the U.S. all at the same time.
The exchange’s ability to meet this challenge without affecting user experience will probably determine whether it can maintain its place at the top of the crypto world.
On the Flipside
- Binance has named Richard Teng as interim CEO after Zhao.
- The recent criminal case does not indict Binance.US.
Why This Matters
The recent dip in crypto asset prices underscores the uncertainty surrounding the market following Binance and Zhao’s guilty pleas.
Read this to learn more about what Binance’s settlement and Zhao’s resignation mean for the industry:
Here’s What Binance’s $4B Settlement and CZ’s Resignation Means
Learn more about the fallout of the SEC case against Kraken:
SEC v. Kraken Puts ADA, MATIC, SOL Back in the Firing Line