Media: US DOJ demands $4 billion from Binance to end investigation

What’s new? Bloomberg reported on the negotiations between the US Department of Justice (DOJ) and Binance to investigate the crypto exchange for money laundering, sanctions violations, and bank fraud. According to journalists, officials have demanded more than $4 billion from the exchange to resolve the claims, otherwise, its founder and CEO Changpeng Zhao could face criminal charges.

Bloomberg’s material

What else is known? According to sources familiar with the matter, the results of the negotiations may be announced by the end of this month. At the same time, neither side has responded to requests for comment.

After Bloomberg’s piece was published, the rate of Binance’s BNB Chain blockchain’s native token jumped by 8,5% to $266,42. The market capitalization of the asset increased by more than $3 billion. As of November 21, 07:00 UTC, BNB’s exchange rate corrected to $258,5.

The parties may agree to defer prosecution, in which case the DOJ will file a complaint. Still, they will not prosecute if the exchange fulfills the prescribed conditions, which usually include payment of a fine and agreement to the claims.

Among other things, the DOJ is investigating violations of sanctions against Iran and Russia. The exchange itself claimed that it thoroughly complies with the restrictions on Iran, sometimes even mistakenly blocking the country’s citizens living outside its borders. After it became known that an investigation into the violation of sanctions against the Russian Federation had begun, Binance sold its entire local business to CommEX and began exiting the market.

In addition, in 2023, the exchange faced accusations from US market regulators. Thus, the Commodity Futures Trading Commission (CFTC) accused the exchange of allowing local clients on its global platform despite the ban, and the Securities and Exchange Commission (SEC) said that Binance offered unregistered investment contracts and misused client funds.

After that, Binance.US’s local market share fell below 1%, and the media reported on Zhao’s failed attempt to liquidate the company. Later, Binance.US CEO Brian Schroeder, who was said to be the only one who opposed the liquidation, resigned. Following this, another third of the staff was laid off.

Notably, even before the lawsuits were filed, Binance had stated its willingness to pay fines to settle the investigation into its operations.