ALBAWABA- This week's crypto news highlights a series of legal developments involving major players, as The US DOJ levied a $ 4.3 billion settlement on Binance and its founder CZ who pleaded guilty and resigned as a CEO. SEC sued Kraken on charges of operating an unregistered exchange and fund commingling which Kraken rebuts. Furthermore, the court of appeal turned down Sam Bankman-Fried’s request for his temporary release while the former Chief Executive Officer awaits charges on counts of fraud, racketeering, and money laundering. These cases show how the regulatory surveillance of this industry is getting more intense.
Binance, CZ settle charges with U.S. authorities for $4.3 billion
Binance cryptocurrency exchange together with their CEO, Changpeng “CZ” Zhao, settled criminal and civil suits with the US DOJ. According to Attorney General Merrick Garland, CZ will plead guilty to a single felony charge under the negotiated agreement. In this regard, Garland cited Binance’s involvement in providing a means for laundering money obtained from criminal activities.
After the settlement, CZ revealed on X (formerly Twitter) that he has stepped down as the CEO, paving the way for Binance’s global head of regional markets, Richard Teng, to assume leadership. Upton, however, CZ pointed out that Binance had not been accused by US officials of misappropriation or manipulation of the market. Although released on bail, CZ finds it difficult to challenge the government’s attempt to bar him from returning to the UAE where he wants to be with his family. However, CZ sentencing will take place next February and the last but not least stage of this great political drama.
SEC files suit against Kraken for allegedly operating an unregistered exchange that commingle funds
Cryptocurrency exchange Kraken was sued by the US SEC for being an unlicensed trading platform and commingling customers’ assets. According to the complaint put forward by the SEC, Kraken did not register with the SEC as a securities exchange, dealer, and clearing agent. The SEC also states that the joint activities and “weak” organizational structure at Kraken have resulted in commingling up to $33 billion dollars worth of client’s property with their money thereby exposing the clients’ wealth to significant danger. As a counter-move, Kraken posted a blog arguing that the charge of co-mingling was nothing but their usage of existing fees. The regulator did not allege about the miss-user fund and Krakan also noted this in their response. It brings important questions regarding regulatory compliance as well as financial integrity as far as exchanges of cryptocurrencies are concerned.
The appellate court turns down Bankman-Fried’s bail application and upholds his incarceration at the start of his appeal
A US appellate court has quashed Sam Bankman-Fried’s petition for bail. Nevertheless, the former FTX CEO failed in the endeavor to be freed on appeal after securing a conviction. Government prosecutors allege that Bankman-Fried had leaked Ellison’s diaries to the New York Times in July, causing Judge Leonard Wexler to rescind his bail in New York City. After being convicted of fraud and money laundering charges on November 2, Bankman-Fried will be remanded till March 28, 2023, when he is set to be sentenced. It is a recent aspect that shows the legal dimensions surrounding the much-debated matter that involves the harsh attitude of the judiciary.
