Written by: Yangz, Techub News
Under the spotlight of the global cryptocurrency market, any subtle signal can be captured.
Early this morning, Binance and its founder Changpeng Zhao (CZ) once again became the focus of the industry. According to a report by Bloomberg citing informed sources, the world's largest cryptocurrency exchange is in deep discussions with the U.S. Department of Justice (DOJ) to potentially reach an agreement that could exempt it from some key regulatory requirements in its $4.3 billion settlement.
More intriguingly, Changpeng Zhao quietly updated his X (platform profile) this morning, changing it from the somewhat detached "ex-@binance" back to the direct "@binance." This seemingly simple action strongly suggests that this legendary figure in the cryptocurrency field, after experiencing intense confrontations with U.S. regulators and a brief prison sentence, may be brewing a comprehensive return.
Background of the Settlement: A Compromise of Hefty Fines and Strict Regulations
Before trying to understand the significance of the current negotiations, let's first review the historic settlement that shocked the entire industry at the end of 2023.
Core Allegations: In 2023, regulatory agencies such as the U.S. Commodity Futures Trading Commission (CFTC) made severe allegations against Binance, primarily accusing it of failing to establish effective and sound anti-money laundering (AML) and KYC procedures, and even of deliberately evading U.S. laws, allowing illegal funds to flow through its platform, which severely violated financial regulations such as the Bank Secrecy Act.
Settlement Conditions: To completely resolve these serious allegations, Binance paid a hefty price. It agreed to pay up to $4.3 billion (one of the largest corporate fines in U.S. history). The settlement agreement included several stringent compliance rectification requirements, the two most critical being the appointment of an independent external compliance monitor for three years, whose role is to delve into the company's internal operations, comprehensively review and monitor the execution of Binance's compliance plan, and report to the U.S. government; and founder Changpeng Zhao must resign as CEO, personally acknowledge the allegations, pay a hefty fine, and serve time.
CZ's Price: As a core part of the settlement, Changpeng Zhao personally bore significant responsibility. He resigned as CEO of Binance and paid a personal fine of $50 million. More notably, he began serving a four-month sentence in a low-security federal prison in California starting last June. Although the sentence was far shorter than the three years initially sought by prosecutors, the imprisonment of such a high-profile figure sent a strong deterrent signal to the entire industry.
While this settlement allowed Binance to avoid more disastrous consequences (such as license revocation or forced closure), its operations have been shackled by heavy "chains," especially with the involvement of an external monitor, meaning the company's every move is under close scrutiny by the U.S. government.
Latest Developments: Seeking "Deregulation" and CZ's Return Hint
In this context, the two latest developments are particularly significant.
First, Binance's current quest for "deregulation" is actually seizing the opportunity. According to Bloomberg, the DOJ is currently conducting a broad review of similar monitor agreements it has reached with multiple companies, partly due to widespread complaints from businesses that such oversight is "burdensome and expensive." Matthew Galeotti, the new head of the DOJ's criminal division, acknowledged in a memo that while monitors can reduce recidivism, they also incur "huge expenses and disrupt legitimate business operations." Additionally, the DOJ has prematurely ended the oversight of two Glencore subsidiaries that were appointed monitors during the Biden administration.
Therefore, Binance is actively lobbying to become the next entity to be "deregulated." If it can successfully exempt itself from the external monitor requirement, replacing it with "enhanced compliance reporting requirements," it would be a significant strategic victory for Binance. This would mean a substantial restoration of the company's operational autonomy, increased operational flexibility, and significant savings on monitoring costs (according to Glencore's annual report, these two subsidiaries incurred a total of $142 million in regulatory costs in 2023 and 2024). This would undoubtedly be a key step in Binance's strategy to "regain the trust of U.S. authorities" and "return to normal operations."
Second, almost simultaneously with this negotiation news, there was a "reset" of Changpeng Zhao's personal identity. Changing his profile from "ex-Binance" back to "Binance" is an extremely strong public signal, conveying at least two layers of information:
The end of personal severance: Completing the four-month sentence means that Changpeng Zhao has legally taken responsibility for his past mistakes. The change in his profile symbolizes that the phase of severance from Binance has officially ended.
Guiding the ship's course: The profile change suggests that he is preparing to re-engage deeply with Binance in some form. This involvement may not necessarily mean resuming the CEO position, but it will undoubtedly guide the direction of Binance, either behind the scenes or in the spotlight. Especially at a critical moment when Binance faces market competition from rising stars like Hyperliquid, the founder's return would greatly stabilize morale, consolidate community consensus, and provide direction.
The simultaneous occurrence of these two events is no coincidence. It likely indicates that negotiations between Binance and the DOJ have made positive progress, giving Changpeng Zhao the confidence to publicly announce his return. At the same time, his return may be seen by Binance as a card to strengthen its negotiating leverage with the government, demonstrating the stability of the company's core leadership and a firm commitment to future compliance.
Conclusion
The game between Binance and U.S. regulators and its latest developments have long transcended individual cases, profoundly shaping the ecology and landscape of the entire cryptocurrency industry. The $4.3 billion settlement has set a strict compliance benchmark for the industry, warning all cryptocurrency companies in the most severe manner that the era of "barbaric growth" ignoring traditional financial regulatory rules has completely ended. Compliance is no longer optional; it is a necessary choice for survival and development. The DOJ's consideration to cancel the monitor also reflects a subtle shift in regulatory strategy—no longer solely emphasizing high-pressure punishment, but seeking a balance that ensures compliance without stifling innovation.
It is worth noting that the regulation of the cryptocurrency industry is showing an increasingly significant political tendency. From Changpeng Zhao's attempts to seek a pardon, to reports of business ties between Binance and the Trump family enterprise, as well as the fact that the industry has become an important source of campaign contributions, all indicate that the regulation of the cryptocurrency industry has become highly politicized.
The addition and subtraction of two letters in Changpeng Zhao's X profile and the negotiations between Binance and the DOJ regarding "deregulation" together outline the strategic path for Binance in the post-settlement era. This regulatory storm, which began with hefty fines and imprisonment, is entering a new phase of negotiation. Regardless of the final outcome, the next moves of Changpeng Zhao and his empire will continue to capture the attention of global investors and regulators.
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