Binance founder and CEO Changpeng Zhao is stepping down from his post as part of a $4.3 billion settlement between his firm and the Department of Justice, sources close to discussions told Forbes on Tuesday.
As part of the settlement, Zhao will plead guilty to anti-money laundering charges brought against him by the DOJ.
He will officially enter a plea in Seattle federal court on Tuesday afternoon, according to the Wall Street Journal. Binance will also plead guilty and agree to the settlement amount.
The settlement also includes participation of the Commodities Futures Trading Commission, which sued Binance over “compliance evasion” in March. The Securities and Exchange Commission, however, is not participating in the settlement.
The SEC hit Binance and Zhao in June with more than a dozen charges, including operating an unregistered exchange and using a separate Zhao-owned entity to inflate the trading volume on Binance.US, the exchange’s U.S. affiliate.
“Through thirteen charges, we allege that Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law,” SEC Chair Gary Gensler said in June.
“As alleged, Zhao and Binance misled investors about their risk controls and corrupted trading volumes while actively concealing who was operating the platform, the manipulative trading of its affiliated market maker, and even where and with whom investor funds and crypto assets were custodied,” Gensler said at the time.
Tuesday’s deal will allow Zhao to retain ownership of Binance, but will disallow him from holding an executive role at the firm, the Journal reported.
Binance, the DOJ, CFTC and SEC did not return requests for comment from Banking Dive.