Changpeng Zhao, the founder of Binance, the largest cryptocurrency exchange in the world, agreed to plead guilty to money laundering violations, according to court papers made public Tuesday, a stunning blow to the most powerful and influential figure in the global crypto industry.
Binance itself also agreed to plead guilty and pay $4.3 billion in fines and restitution, according to the documents, filed in federal court in Seattle.
As part of his guilty plea, Zhao agreed to pay a $50 million fine and will also step down from his role as chief executive of the company. Binance, as part of its plea deal with federal prosecutors, will accept appointment of a monitor, and Zhao is barred from any involvement in Binance’s business until three years after the monitor is appointed.
The court papers, which are dated Monday, said criminal charging documents were filed by federal prosecutors against both Binance and Zhao on Nov. 14.
The court documents described a wide-ranging effort by Zhao and other senior Binance employees to avoid laws that require them to abstain from transacting with people barred from the U.S. financial system because of economic sanctions and register any U.S.-based businesses properly with regulators. Customers from Iran, Cuba and Syria — all of which face sanctions — were able to access the Binance platform.