How Binance Could Pay $4 Billion to Escape U.S. Criminal Charges

Binance, the world’s largest cryptocurrency exchange by trading volume, is reportedly facing a $4 billion fine from the U.S. Department of Justice (DOJ) to settle a criminal investigation into its operations.

According to a report by Bloomberg, the DOJ is probing whether Binance violated U.S. laws by allowing Americans to trade on its platform without registering with the Securities and Exchange Commission (SEC) or the Commodity Futures Trading Commission (CFTC).

The report also claims that Binance is in talks with the DOJ to reach a settlement agreement that would end the criminal case and avoid a potential indictment. The settlement could include a fine of up to $4 billion, which is equivalent to 10% of Binance’s estimated annual revenue, as well as other conditions such as hiring a compliance officer and implementing stricter anti-money laundering measures.

Binance has not confirmed or denied the report, but its CEO Changpeng Zhao (CZ) tweeted on Monday that the company is “always open to constructive dialogues with regulators” and that it is “committed to complying with local laws and regulations wherever we operate”.

Binance has been under increased scrutiny from regulators around the world in recent months, as the cryptocurrency industry faces growing pressure to adhere to global standards and protect investors from fraud and manipulation.

In September, the U.K.’s Financial Conduct Authority (FCA) banned Binance from offering certain products and services to British customers, citing a lack of proper authorization and oversight. In October, the CFTC announced that it was investigating Binance for allegedly allowing U.S. users to trade derivatives linked to cryptocurrencies without registering as a futures commission merchant. In November, the SEC issued a subpoena to Binance, seeking information about its operations and transactions involving U.S. investors.

Binance has maintained that it is a decentralized entity that does not have a single headquarters or jurisdiction, and that it complies with local laws and regulations wherever it operates. However, some experts have questioned the legality and sustainability of Binance’s business model, which relies on a network of affiliates and partners to offer its services in different markets.

Binance’s legal troubles have also affected its reputation and market share, as some users and investors have expressed concerns about the security and stability of the platform. According to onchain data, Binance’s daily trading volume has dropped by more than 50% since June, when it reached a peak of over $100 billion. Binance’s native token, BNB, has also lost about 40% of its value since its all-time high of $686.