New Binance CEO Pledges to Improve Investor Confidence
- The new Binance CEO plans to comply with regulators.
- Binance has seen massive outflows over the past 24 hours.
The new Binance CEO, Richard Teng, has made his first official post as the company’s boss. Teng was surprisingly announced as CEO of the world’s biggest crypto exchange on Tuesday following the resignation of Binance founder and former CEO Changpeng Zhao.
Binance’s settlement with the Department of Justice has raised concerns amongst its users, especially about breaches of trust. However, Teng assured Binance users that “the foundation on which Binance stands today is stronger than ever.” The new CEO pledged to improve investor confidence, collaborate with regulators, and boost Web3 adoption.
Teng, a seasoned professional from Singapore’s industry, joined Binance in 2021 to increase its global compliance. Teng began his career with Binance as CEO of Binance Singapore and was appointed head of regional markets in May this year.
Teng joins Binance with a wealth of experience. Before joining the exchange, he served as the CEO of the Financial Services Regulatory Authority at Abu Dhabi Global Market. Teng also worked as the chief regulatory officer at the SGX, where he helped ensure compliance with policies.
What is the situation at Binance?
Data from blockchain security company Nansen confirms massive withdrawals from Binance over the past 24 hours. Outflows from the exchange have exceeded $1 billion, driven by Binance’s settlement with the DOJ and CZ’s resignation from the firm.
The BNB coin took a major hit and has slipped by over 8% since the news broke. Crypto experts are curious to find out if the exchange will survive this transition and how it will pay the settlement fees. Yesha Yadav, a professor of law, explained that “the sum of $4 billion is clearly very large and will create real pain for Binance’s balance sheet.”
Yadav told CNBC in an interview
This fine does not appear to be aimed at dealing a fatal blow to the exchange. Based on Binance’s dominant position within the crypto-ecosystem over a number of years, CZ’s personal wealth, and continuing trading volumes despite declines in overall crypto trading volume as well as in Binance’s market share relative to other venues, I doubt that Binance will face risks to its solvency in paying this fine.
Despite the heavy penalty, Binance will continue to operate, although with stricter guidelines. The exchange is required to maintain a successful compliance program to ensure that its operations comply with US anti-money laundering regulations. The settlement also requires the exchange to appoint a third-party compliance monitor.
Some of Binance’s competitors, including Coinbase, Kraken, and OKX, might try to capitalize on the circumstances. However, both Coinbase and Kraken have legal issues with the SEC. The SEC sued Kraken on Monday, claiming that the exchange mingled $33 billion in cryptocurrency assets owned by its customers with corporate assets, putting users at serious risk of losing a sizable amount of their funds.