According to a report by The Information, Binance.US founder and primary owner Changpeng Zhao is considering selling some or all of his stake in the company. CZ has reportedly been seeking to offload some of its stock holdings since the second quarter of last year.
Regulators Have Been on Binance’s Neck for a While
In a lawsuit filed in March the Commodity Futures Trading Commission (CFTC) identified Zhao and Binance US COO Samuel Lim as defendants. The CFTC action specifically names Binance.US as a defendant, claiming several violations.
According to the agency Binance.US made substantial revenues by using key business relationships inside the nation. The complaint however, claims that both the exchange and CZ willfully ignored requirements for registration and compliance under US federal law.
Advertisement Banner
The Commodity Futures Trading Commission also claimed that Binance, Zhao and Lim assisted American customers while violating federal laws. They reportedly utilized VPNs to access the restricted areas of Binance. Furthermore the letter suggests that Binance hides its ownership and organizational structure behind a maze of corporate entities.
The commodities watchdog has laid the responsibility on the exchange, the CEO and the ex-head of compliance. The authorities accused them of “deliberate evasion” due to their exploitation of regulatory arbitrage.
CZ Is Considering Selling His Shares in Binance.US
The report claims that company leaders are contemplating whether or not to lower CZ’s ownership stake. This would be done to appease authorities in the United States. Binance is concerned about CZ’s participation in CFTC lawsuit. Senior management allegedly worries that if Zhao continues to be the company’s majority shareholder the firm would be unable to secure necessary permits from regulatory bodies.
Former and present Binance.US executives also speak out against the CFTC’s move. Catherine Coley, a former official at Binance retained James McDonald of Sullivan & Cromwell to defend her in a case filed by the CFTC against the company.
You may be interested in:
A Growth Of Over %4,900 Is Eminent In Tokenized Assets By 2030
