U.S. Department of Justice Pushes for $4 Billion Binance Settlement to Halt Investigation, BNB Price Surges to $266

Ripples of relief and volatility surged through the crypto sphere as news broke regarding Binance, the world’s largest crypto exchange, possibly averting a shutdown amid looming criminal charges. Bitcoin (BTC) and BNB Coin (BNB) soared on the heels of this revelation.

According to Bloomberg reports, Binance might settle multiple criminal charges in the U.S. by month’s end, potentially paying a staggering $4 billion. Crucially, this settlement is anticipated to pave the way for the exchange to sustain its operations. However, CEO Changpeng Zhao is still expected to face criminal allegations involving bank fraud, money laundering, and violations of financial sanctions. Zhao, notably residing predominantly in Dubai (UAE), resides in a jurisdiction without an extradition agreement with the U.S.

Sources cited by Bloomberg indicate that the official announcement regarding these developments could emerge from the U.S. Department of Justice by the end of November, although specific details remain undisclosed. The ongoing investigation involves the Money Laundering and Asset Recovery Section, National Security Division, and the Seattle U.S. Attorney’s Office within the U.S. Department of Justice.

A $4 billion penalty, if accepted by Binance, would mark one of the largest fines in the history of the cryptocurrency industry. The U.S. Department of Justice deems this penalty appropriate to enable Binance to continue its operations, mitigating the risk of indictment and potential destabilization to the crypto industry.

The U.S. Department of Justice commenced its investigation into Binance in 2020 concerning money laundering allegations, yet no formal charges have been filed to date. Speculation arose in late 2022, indicating prosecutors’ hesitance despite collected evidence—some believing it sufficient for indictment while others advocating for additional evidence.

Furthermore, Binance faces separate lawsuits from two other U.S. financial regulators: the Commodity Futures Trading Commission (CFTC) filed a lawsuit in March 2023, followed by the Securities and Exchange Commission (SEC) in June 2023, both levying serious allegations regarding mismanagement and listing of cryptocurrencies deemed securities.

Neither Binance nor CEO Changpeng Zhao have made statements regarding the purported $4 billion settlement with the U.S. Department of Justice for reconciliation.

Following Bloomberg’s disclosure, Binance’s token BNB initially surged over 10% from $238 to $268 before stabilizing around $265. The current sentiment in the crypto community perceives the U.S. Department of Justice’s investigation into Binance as its most significant challenge to date. The potential alleviation of this legal burden might signal a fresh start for the exchange, especially with Bitcoin’s halving event approaching in April 2024, marking the onset of a new growth cycle.

BNB/USDT 4 hours-chart on Binance | Source: TradingView

Nevertheless, Binance continues to grapple with civil lawsuits from both the CFTC and SEC, prompting an exodus of high-level executives throughout 2023.

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