The U.S. Justice Department is seeking more than $4 billion from Binance Holdings as part of a proposed resolution of a years-long investigation, Bloomberg News reported on Monday, citing people familiar with the discussions.
Binance operated in Malta from October 2018 to October 2019. During this period, cryptocurrency firms that relocated to Malta were given a one-year window, until October 2019, to obtain authorization by aligning with regulatory standards.
Binance has been under the Justice Department’s scanner since at least 2018, Reuters reported last year. Federal prosecutors asked the company in December 2020 to provide internal records about its anti-money laundering checks, along with communications involving Zhao, Reuters has reported.
The DoJ probe is one of a string of legal and regulatory headaches the world’s biggest crypto exchange faces in the United States.
In June, the Securities and Exchange Commission sued Binance and Zhao, accusing them of operating an “elaborate scheme to evade U.S. federal securities laws.”
Binance denied the SEC’s allegations and said it would “vigorously defend” its platform.
The Commodity Futures Trading Commission also sued the exchange in March for “willful evasion” of U.S. commodities law, alleging that Binance and Zhao operated an “illegal” exchange and a “sham” compliance program.
Zhao fought back, calling those charges an “incomplete recitation of the facts.”
But with crypto markets subdued compared with the highs of 2021, Binance continues to have a rough year. It has also witnessed an executive exodus and slumping market share.
At least a dozen executives have left the exchange in recent months, including Binance’s chief strategy officer, general counsel and chief product officer.