Binance To Face Regulatory Hurdles Until Cz Disaffiliates
Date
9/14/2023 2:01:49 PM
(MENAFN- CoinXposure) Binance.US, the American global Cryptocurrency exchange branch, faces regulatory obstacles and internal reorganization .
Reports indicate that the connection between Binance's CEO, Changpeng Zhao, and the current regulatory environment in the United States could impede the platform's prospective expansion.
After the Securities and Exchange Commission (SEC) filed a lawsuit against Binance, accusing Zhao of having the authority to“divert customer assets,” Binancehas initiated measures to reduce its operations and workforce.
Binance has responded to the lawsuit by committing to defend its platform vigorously.
In a recent all-hands meeting, Binanceemployees were presented with three potential strategies to address the existing challenges.
The first option involves proceeding with planned growth initiatives, provided that Zhao resolves his regulatory issues with the SEC and either sells or transfers his Binanceshares to a confidential trust.
The second approach entails a moderate expense reduction, including sub-account functions and infrastructure optimization, while actively seeking new investments. However, the success of this approach depends on investor willingness to support the company in a bear market.
See also L1TF Proposes Community-Owned Wallet for LUNC 2 months ago
The third option includes a temporary“hibernation” period aimed at reducing costs while maintaining essential operations until there is a significant improvement in the situation at Binance.US. If Zhao successfully addresses regulatory concerns, the platform may resume its growth plans following hibernation.
In response to increasing regulatory pressure, Binancehas reduced staff by around 100 employees. Brian Shroder, the CEO, has stepped down, with Norman Reed, Chief Legal Officer, temporarily assuming leadership.
These developments highlight the company's challenges in adapting to the evolving regulatory framework in the United States, necessitating strategic deliberations to secure its future sustainability.
MENAFN14092023007320015750ID1107070504
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.