Binance’s Leadership Crisis Escalates with Gleb Kostarev’s Resignation as Eastern Europe Head
Gleb Kostarev, Binance’s VP in charge of Eastern Europe, CIS, Turkey, Australia and New Zealand, announced his resignation today on Facebook.
His departure follows the exit of Binance’s former global head of product, Mayur Kamat.
Other high-profile exits from Binance in recent months include Chief Strategy Officer Patrick Hillmann and General Counsel Hon Ng.
Binance’s leadership exodus continues as its Head of Eastern Europe, Gleb Kostarev, announced his resignation today on Facebook.
Kostarev’s departure from Binance comes after spending five years at the cryptocurrency exchange. It closely follows the departure of Binance’s global head of product, Mayur Kamat, announced on Monday.
Besides leading Binance’s operations in Eastern Europe, Kostarev was also in charge of the cryptocurrency exchange’s operations in the Commonwealth of Independent States (CIS), Turkey, Australia and New Zealand.
In his Facebook post, Kostarev mentioned that he “quit APAC a few months ago.” Although he did not reveal the reasons for his departure, he mentioned that he intended to take a break when asked about his future plans.
“I would like to express my gratitude to CZ and He Yi for their trust and all the opportunities they have given me. Also, many thanks to my former colleagues for their professionalism and knowledge of best practices in the industry,” Kostarev wrote in his farewell note.
Could Kostarev’s Departure Signal Binance’s Russian Exit?
The departure of Gleb Kostarev from Binance comes as no surprise. The Wall Street Journal recently reported that Binance is considering a full exit from Russia, citing an unnamed company spokesperson.
Kostarev had hinted at his departure from the crypto exchange when he shared the news about Binance’s potential withdrawal from the Russian market just days before his resignation.
The controversy surrounding Binance and its Russian operations is not new. A previous WSJ report suggested that Binance allowed trading in rubles with sanctioned Russian banks, contrary to its claims of adhering to U.S. and EU sanctions.
In response to these allegations, the exchange moved to cryptocurrency trading in Russia, focusing primarily on the ruble, and prohibiting other currencies for its peer-to-peer service.
“If you are a user from Russia but do not live in Russia and have passed verification of your foreign address, then on P2P you can trade in all currencies except the ruble, euro, dollar and hryvnia,” Kostarev clarified in a Facebook post on Aug 27. “Only Russian users residing in Russia can now trade the ruble on P2P.”
In May, Bloomberg reported that the U.S. Justice Department was investigating whether Binance had been used for illegal money transfers by Russians seeking to evade U.S. sanctions. This investigation, based on insider information, has contributed to the cloud of uncertainty hovering over the exchange.
Binance’s Key Leadership Exodus
The resignation of two key executives from Binance this week is not an isolated event.
In July, Binance’s former Chief Strategy Officer Patrick Hillmann, senior VP of compliance Steven Christie, and general counsel Hon Ng announced their departure from the company.
Both Hillmann and Christie cited personal reasons for their resignation. “I’ve taken this company through a lifetime of industry crises and regulatory challenges — from Luna to 3AC to FTX,” Hilmann said.
Amid the wave of resignations, CZ Chao took to Twitter to Twitter to dispel the rumors of internal strife within the company.
“More FUD about some departures,” he tweeted. “As markets and the global environment for crypto changes, as our organization evolves, and as personal situations change, there is turnover at every company.”
Binance’s Regulatory Hurdles Across Continents
Despite having hired compliance executives, Binance faced a surge in regulatory challenges with the SEC filing charges against the exchange in June. The legal proceedings are still ongoing.
It faced regulatory hurdles not only in the U.S., but also in Nigeria. In Europe, the exchange withdrew its request for German regulatory approval in late July following a series of rejections and exits from Belgium, the Netherlands, and Cyprus.
However, there is still hope for Binance, as the potential for operating across all 27 EU member states may become a reality with the forthcoming Markets in Crypto Assets (MiCA) regulation from the EU.
Under this framework, the exchange could apply for a license in a single EU country, and if granted, secure overarching approval to operate across the entire EU.
As indicated on Binance’s official website, the exchange is presently registered with regulatory authorities in several EU countries, including France, Italy, Lithuania, Spain, Poland, and Sweden.
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