Binance CEO Richard Teng has remarked that the “gaps in compliance” from Binance’s early days are long gone and that the crypto exchange is now “totally different.” Teng, Binance’s previous head of regional markets, was promoted to CEO on 21 Nov. after Changpeng “CZ” Zhao stepped down after pleading guilty to charges brought against him by the US Department of Justice.
“As part of the settlement, CZ cannot be involved in the day-to-day running of the company’s operations,” Teng said.
Despite this, the current CEO of Binance appears to be relishing the challenges ahead. Teng appears to like being at the helm of the world’s largest cryptocurrency exchange, speaking to Cointelegraph just two weeks after taking over from CZ:
“I’m taking the baton and pushing ahead with our growth agenda while working very closely with global regulators.”
Teng feels that the “overcast” conditions that have hung over Binance in recent months have lifted as a result of its unprecedented $4.3 billion settlement with the Justice Department pertaining to a number of infractions of US legislation and sanctions programmes.
A $4.3 billion settlement was reached as a result of early deficiencies in compliance
The exchange has suffered dearly for mistakes committed during its rapid rise beginning in 2017. Teng remembered how Zhao grew Binance from a six-person team to a global organisation with hundreds of staff and a user base believed to be more than 166 million.
“In those very early days, while we were building up the company, there were gaps in terms of compliance. That resulted in all these breaches and mistakes, but these are historical issues.”
It is an honour and with the deepest humility that I step into the role of Binance’s new CEO.
We operate the world's largest cryptocurrency exchange by volume. The trust placed on us by our 150m users and thousands of employees is a responsibility that I take seriously and hold…
— Richard Teng (@_RichardTeng) November 21, 2023
The flaws in its early compliance procedures resulted in the biggest crypto-related settlement in US history. Teng, on the other hand, claims that the firm has always kept customer finances, security, and safety “sacrosanct.”
U.S. agencies thoroughly examined our operations in order for us to achieve this agreement, and there is no accusation of theft of customer cash,” he continued.
Binance has responsibilities to US authorities
Binance is now responsible for the continued costs and scrutiny associated with its deal with US authorities. This includes a five-year monitoring period as well as major compliance commitments to ensure “Binance’s complete exit from the United States.”
Teng refused to comment on Binance.US’ continuing legal struggle with the Securities and Exchange Commission over suspected securities breaches. Nonetheless, he insists that the corporation has factored in the expenses of satisfying the criteria outlined in its settlement and its SEC complaint.
Binance’s CEO is likewise constrained by nondisclosure agreements related to the $4.3 billion settlement and will not comment on the method of payment. According to Cointelegraph, Binance is in the process of paying its assessment, while the former CEO will settle a separate charge made against CZ personally.
The business also stated that the $1.00 drop in Tether USDT tickers reported on November 21 was “unrelated to resolution matters” with the US Justice Department.
Was Binance unjustly treated?
In recent years, prominent leaders in the cryptocurrency field, including as former BitMEX CEO Arthur Hayes and Galaxy Digital’s Mike Novogratz, have commented on the discrepancy in treatment of Binance and mainstream banking institutions.
Teng commented on the idea that “Wall Street banks” had not received the same treatment despite potentially greater failures.
“In the financial industry, fines are not unusual. “A Google search of the list of fines paid by financial institutions yields a list of nearly $90 billion in fines,” Teng added.
Here is my first blog as #Binance CEO.
I want to take this opportunity to share immediate focus areas, discuss our responsibility to users and my view on the future of our industry.https://t.co/c6QMS6Ulmm
— Richard Teng (@_RichardTeng) November 27, 2023
It is unimportant if Binance has been made an example of. Despite this, Binance may be the “most regulated exchange globally,” since it operates in 18 different jurisdictions.
Binance will now place a premium on compliance. The corporation has made news for carefully hiring people to navigate regulatory constraints in several regions.
Teng stated that the business has “invested heavily” in this area, citing important personnel on its compliance team with histories in regulatory authorities such as the SEC and traditional financial organisations such as Morgan Stanley and Barclays.
Building in the UAE and France
Binance is still a worldwide organisation, however it has established two regional offices. The United Arab Emirates acts as its Middle East and North Africa (MENA) headquarters, while France serves as its European base.
Teng is no stranger to the former area, having previously resided in the UAE for nine years and worked as CEO of local regulator Abu Dhabi Global Markets. His job entailed creating a cryptocurrency foundation for the local ecosystem.
“When I first heard about cryptocurrency, I thought it was the future of finance.” “However, for this to truly gain traction and achieve mass adoption, two elements are required,” Teng stated.
On the AMA I was asked to take a 4 photo. I need my own thing, so I'll do the 3 instead.
It represents my 3 commitments as #Binance CEO:
1) Being user-focused, always
2) Working with regulators to uphold standards
3) Collaborating with partners to grow Web3 pic.twitter.com/DcJyFVj8LX
— Richard Teng (@_RichardTeng) December 1, 2023
The first concern is rule and regulation clarity, and the second is encouraging institutional adoption. Teng believes that the latter factor is critical since it attracts investors and liquidity while also driving research.
As a result, the UAE has become a metaphorical oasis for the bitcoin and blockchain industries. As a base of operations in the MENA area, it continues to draw global businesses.
Binance’s chances in the area are further boosted by the introduction of the European Union’s Markets in Crypto-Assets law.
“You have clarity of rules to operate in 27 different jurisdictions,” Teng added, providing a blanket set of criteria for a sector that has previously suffered from “rules disparity.”
Binance was forced to cease operations in the Netherlands in June 2023 after failing to meet registration criteria for a local virtual asset service provider licence. MiCA might be used to enter new markets until 2024 and beyond.
Binance stepping into CZ’s shoes
Putting oneself in CZ’s shoes is an impossible endeavour. Binance’s creator, according to Teng, is an inspirational leader and wonderful mentor who is focused on execution.
The incumbent was also candid in his realisation that he could not replace CZ’s role as a founder-CEO, but the present scenario also lends to the benefits of a new face and new methods.
“What I can do is bring my own values and expertise to the table in a maturing company. Six years ago, compared to now, Binance is totally different.”
The new CEO will report to a board of directors, which will serve as the company’s governing authority.
Teng intends to keep a schedule in his personal life if and when he finds time to unwind. The CEO likes working out, doing “weights, cardio, and core.” He’s also a bookworm, with Walter Isaacson’s biography of Elon Musk being his most recent read.
The whole conversation with Cointelegraph and Richard Teng is available on Spotify, Apple Podcasts, Google Podcasts, or your favourite podcast provider.