Binance CEO confirms CZ is banned from managing the exchange

Changpeng “CZ” Zhao, former CEO of Binance, has reportedly received a lifetime ban from managing or operating the crypto exchange as part of a plea deal with U.S. authorities. 

According to Binance CEO Richard Teng, this restriction is permanent, countering earlier reports that suggested a three-year ban. 

A Sept. 5 report by Axios reveals that Zhao’s plea deal, filed in November 2023, involved a $4.3 billion settlement with U.S. regulators after CZ pleaded guilty to a felony charge related to violations of the Bank Secrecy Act. 

He was sentenced to four months in prison and is expected to be released on September 29. 

As part of the agreement, Zhao stepped down as CEO, with Teng taking over his position. 

CZ mentioned he would be available to consult the team but would no longer serve in a management role, allowing Binance to "walk and run." 

While the plea agreement explicitly mentioned that CZ would be prohibited from “any present or future involvement in operating or managing” Binance, it was described as a “consideration” rather than a mandatory condition for the prosecutors. 

This phrasing led to some ambiguity, but Teng has now clarified that the ban is indeed a lifetime prohibition. 

The settlement also required Zhao to pay $50 million to U.S. regulators. 

However, Binance's legal troubles are not over; its case with the U.S. Securities and Exchange Commission (SEC) remains ongoing as of September 2024. 

The outcome of this case could be influenced by recent Supreme Court opinions that might limit the SEC’s authority in crypto enforcement.