Binance’s CZ Almost Shut Down the U.S. Arm of the Exchange
In Brief
Binance CEO Changpeng “CZ” Zhao reportedly planned to shutter its United States arm earlier this year to protect its global operations.
Binance.US CEO Brian Shroder opposed CZ’s choice because he was concerned that a sudden closure would harm the U.S. exchange’s clients by forcing them to transfer or liquidate their cryptocurrency immediately.
The world’s largest cryptocurrency exchange, Binance, reportedly planned to shutter its United States arm earlier this year. According to The Information, the company planned to do so in order to protect its global operations.
Binance CEO Changpeng “CZ” Zhao, who also serves as chair of the Binance.US board of directors, reportedly voted on the liquidation of the company. However, he did not receive support from other board members, and the US arm of the exchange remained untouched.
The CEO of Binance.US, Brian Shroder, reportedly opposed CZ’s choice because, according to a source familiar with the case, he was concerned that a sudden closure would harm the U.S. exchange’s clients by forcing them to transfer or liquidate their cryptocurrency immediately.
“If it is a board vote, 1 vote holding out of 3 won’t stop anything. The 2/3 wins. If it is a shareholder vote, Brian S. is a CEO, not a VC or any other type investor,” wrote Binance CEO CZ on X on August 2.
In March this year, the United States Commodity Futures Trading Commission sued Binance and CZ, claiming that the company had knowingly provided unregistered crypto derivatives products in the country.
In June of this year, the Securities and Exchange Commission started investigating Binance. Then, the SEC filed a lawsuit against the exchange, its US arm, Binance.US, and Changpeng Zhao. The Commission stated that both companies operated as unregistered securities exchanges. In addition, the complaint claims that Binance.com and Binance.US participated in multiple unregistered offers and sales of crypto asset securities as well as different investment schemes. Zhao was also accused of providing three securities market services, including exchange, broker-dealer, and clearing agency, illegally while being aware of the requirement to register with the SEC. It’s worth noting that the lawsuit happened in the same period as asset giant BlackRock’s announcement on the official filing for a spot in the Bitcoin exchange-traded fund.
On a side note, earlier this week, Binance became the first-ever virtual asset exchange to receive an operational Minimum Viable Product license in Dubai.
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About The Author
Valeria is a reporter for Metaverse Post. She focuses on fundraises, AI, metaverse, digital fashion, NFTs, and everything web3-related. Valeria has a Master’s degree in Public Communications and is getting her second Major in International Business Management. She dedicates her free time to photography and fashion styling. At the age of 13, Valeria created her first fashion-focused blog, which developed her passion for journalism and style. She is based in northern Italy and often works remotely from different European cities. You can contact her at [email protected]
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Valeria is a reporter for Metaverse Post. She focuses on fundraises, AI, metaverse, digital fashion, NFTs, and everything web3-related. Valeria has a Master’s degree in Public Communications and is getting her second Major in International Business Management. She dedicates her free time to photography and fashion styling. At the age of 13, Valeria created her first fashion-focused blog, which developed her passion for journalism and style. She is based in northern Italy and often works remotely from different European cities. You can contact her at [email protected]
