In the face of mounting regulatory challenges and the departure of key executives, Changpeng Zhao, the billionaire founder of Binance Holdings Ltd., remains resolute in defending the world’s largest cryptocurrency exchange.
Despite recent setbacks and ongoing investigations, Zhao took to Twitter to express his determination, stating, “we continue to BUILD, and continue to hire.”
Binance, once hailed as a trailblazer in the digital asset sector, has been grappling with a regulatory crisis on multiple fronts. The departures of the chief strategy officer, general counsel, and compliance official have added to the uncertainty surrounding the exchange’s future prospects.
The vacancies left by these executives have raised fresh concerns about Binance’s ability to navigate the intensifying scrutiny from regulatory bodies in the United States, Europe, and the Asia Pacific region.
To counter what he calls “FUD” (fear, uncertainty, and doubt), Zhao has been tirelessly defending Binance against mounting criticism and negative sentiment. While the platform’s share of spot crypto trading volumes has been declining, and its competitors, such as FTX, have experienced bankruptcies, Zhao remains steadfast in his commitment to protect users and uphold Binance’s position as the largest crypto exchange.
The recent departures of Patrick Hillmann, Binance’s chief strategy officer, along with Steven Christie, senior vice president for compliance, and Hon Ng, general counsel, have raised eyebrows in the industry. Hillmann announced his departure on good terms via Twitter, while the new general counsel, Eleanor Hughes, was named as the replacement for Ng. However, the specific reasons behind these departures remain undisclosed.
According to a person familiar with the matter, Binance’s US operations employed nearly 600 individuals. During midyear performance reviews in June, some employees were asked if they were willing to relocate, and those who declined were reportedly let go. Yibo Ling, chief business officer of Binance, was among the US staff members who have recently left the company.
In response to speculations regarding the departures, Zhao refuted the claims made by the media, stating that turnover is a normal occurrence in any company and that the reasons attributed to the departures were inaccurate.
He highlighted Binance’s remarkable growth, having expanded from 30 to 8,000 employees in just six years.
While Binance battles regulatory probes on various fronts, the most notable being the US Securities & Exchange Commission (SEC) lawsuit accusing the company and Zhao of mishandling customer funds and breaking securities rules, the exchange remains resolute.
Binance has described the SEC action as “disappointing” and has expressed its intent to defend its platform vigorously. Additionally, the company faces a lawsuit from the Commodity Futures Trading Commission, and the US Justice Department has reportedly been investigating Binance.
Further adding to Binance’s woes, the Australian Securities and Investments Commission recently conducted searches at Binance Australia locations as part of an investigation into the Australian operation’s defunct local derivatives business.
Regulatory backlash has not been limited to Australia, as France and Belgium have also imposed stricter measures on the exchange. This trend of heightened scrutiny has led to some banking partners severing ties with Binance, making it more challenging for customers to transact and withdraw fiat currency.
According to a report from CCData, Binance’s share of non-derivatives trading volume dropped to 42% in June, marking the lowest level since August 2022. This decline can be attributed, in part, to Binance’s decision to halt certain popular trading pairs, further impacting the platform’s market position.
The native token of Binance, BNB, has also experienced a decline, falling approximately 1% on Friday amidst broader weakness in the digital asset market. Currently trading at around $218, BNB has seen an 11% decline this year, in stark contrast to the 45% gain recorded by the top 100 tokens. The fate of BNB and Binance remains intertwined, with the performance of one often impacting the other.
