Coinbase’s director J Conor Grogan, on Wednesday said Binance has the necessary financial resources to settle with the US Department of Justice (DOJ) without liquidating its cryptocurrency holdings.
What Happened: Analyzing Binance Corporate’s Proof of Reserves, Grogan pointed out the firm’s total assets amounted to $6.35 billion, with a significant portion in stablecoins valued at $3.19 billion.
“Doesn’t include off-chain cash balances or funds held in wallets not in PoR. Most likely able to pay full $4.3B DoJ fine with 0 crypto asset sales.”
Richard Teng, CEO of Binance responded to Grogan saying, “The fundamentals of our business are VERY strong.”
The fundamentals of our business are VERY strong. Binance continues to operate the world’s largest crypto exchange by volume, our capital structure is debt-free, expenses are modest, and, despite the low fees we charge our users, we have robust revenues and profits. https://t.co/PHq2YS0CP5
— Richard Teng (@_RichardTeng) November 22, 2023
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Why It Matters: Amidst the enforcement action, Binance Holdings Ltd along with its former CEO Changpeng Zhao have admitted to lapses in anti-money laundering practices and sanctions violations.
With the agreement in force, Binance consents to pay one of the steepest corporate fines in US history – $4.3 billion. Zhao will personally contribute $50 million and step away from his chief executive role as mandated by the settlement stipulations.
Zhao, who acknowledged his role in violating the Bank Secrecy Act, anticipates a reduced sentence as part of the plea agreement – with an expectation of serving no more than 18 months, reported Reuters.
The company’s admitted transgressions include insufficient preventive measures against and reporting of dubious transactions linked to terrorist entities such as Hamas’ Al-Qassam Brigades, Palestinian Islamic Jihad, Al Qaeda, and ISIS, as put forth by the Treasury Department.
This acknowledgment comes at a critical juncture, with geopolitical tensions heightened amidst the ongoing conflict that commenced on October 7 between Israel and Hamas.
Furthermore, Binance has been scrutinized for facilitating over a million transactions, cumulatively exceeding…
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