In the recent turn of events, the world’s largest crypto exchange by daily trading volume, Binance, has battled a series of legal charges due to non-compliance. The legal peril facing Binance and the recent multi-million settlement with the US regulatory agencies has attracted global attention.
A recent report from the founder of BitMEX, Arthur Hayes, described legal action against Binance and the chief executive, Changpeng Zhao, as absurd punishment. In a November 28 blog post, Hayes expressed regret that Binance and the CEO were treated absurdly.
Binance Battles Legal Charges Due to Non-Compliance
The executive stated that the legal action against the controversial crypto exchange demonstrated the arbitrariness of US legislation. Reflecting on the $4.3 billion penalty settled by Binance, Hayes lamented that the fines were “disproportionately harsh” compared to the hefty fines imposed on the top-level executives responsible for the 2007-2008 financial crisis.
At that time, the corporate leaders of the US best-performing banks received fair treatment since convicting them posed a threat to the entire banking sector. After reviewing the Binance CEO career journey, Hayes noted that CZ rose from a nobody to become the richest crypto mogul.
His career took a progressive trajectory that propelled CZ to head the world’s largest crypto exchange. This exciting career growth posed a threat to the financial and political establishment since it eliminated some of the institutions and undermined power sharing.
Consequences of Violating US Crypto Regulation
Besides Binance, Hayes described the rise and fall of the Terra ecosystem as the nature of crypto. The executive admitted that after launching his crypto exchange in 2014, he was later profiled as a bad boy. Seven years later, the Department of Justice (DOJ) accused Hayes of breaching the Bank Secrecy Act for failing to uphold the anti-money laundering practices.
Following a lengthy court process, Hayes pleaded guilty and received a two-year imprisonment and six months home arrest. After serving the punishment, Hayes moved to Singapore, where he became an active contributor to the crypto industry.
Despite the dramatic changes in the financial sector, BitMEX officials remain optimistic that crypto will replace the “broken banking system.” The executive noted that the conventional financial industry has exposed many to debts.
He regretted that the unsuitability of traditional finance has forced investors to invest in either gold or crypto assets. A few days ago, the CZ resigned from his CEO position after he pleaded guilty to supporting the violation of anti-money laundering (AML) regulations.
Legal Peril Facing Binance Deepens
Guided by the existing rules, the outgoing CEO will face ten years imprisonment and will be required to settle a court fine amounting to $50 million. The court instructed that Zhao will remain in the US until February next year to proceed with his criminal trials.
The court reversed the previous ruling that allowed Zhao to return to his home country in the United Arab Emirates. A review of the court report revealed that allowing Zhao to return to UAE will undermine the ruling since the Arab country lacks a favorable extradition treaty.
According to the DOJ, the embattled CEO focused more on ways to expand revenue streams and failed to comply with the existing laws. The non-compliance of Binance enabled illicit groups to finance their illegal activities through the exchange.
The report revealed that recently, the Iran illicit group transferred assets worth approximately $898 million on Binance without being noticed.
The post BitMEX Founder Describes US Treatment on Outgoing Binance CEO as ‘Absurd’ first appeared on CryptocyNews.com.
from CryptocyNews.com https://www.cryptocynews.com/bitmex-founder-describes-us-treatment-on-outgoing-binance-ceo-as-absurd/
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