Per a recent report from The Information, the CEO of crypto exchange Binance, Changpeng “CZ” Zhao, considered closing its U.S. subsidiary. The possibility was reflected due to the increasing hostilities from regulators against Zhao and the trading venue in the country.
A U.S. Company No More? Binance CEO Reviews Options
According to the report, Zhao thought about leaving the U.S. in early 2023 in a potential move to “protect” the international arm. However, Brian Shroder, current CEO of Binance.US, allegedly opposed the decision to safeguard the platform’s customers.
In the past two years, the crypto space saw the bankruptcy of major companies, including FTX, Celsius, and others. In that sense, crypto investors and the nascent industry’s reputation were negatively impacted; closing Binance.US would have probably added salt to injury and might have triggered another capitulation event.
In practice, the report stated, Shroder worried that this possibility might have hurt their crypto investors by forcing them to sell their assets at the market, and with another significant exchange closing, the price of Bitcoin and other assets would have been much lower.
Citing two people familiar with the matter, the report also claims that the Binance.US board of directors, which Zhao presides as Chairman, voted on the issue.
According to The Information, there was a meeting where executives discussed the possibility of closing Binance.US. However, it was reported that Zhao failed to gain enough support to go through with the closure.
As Bitcoin has been reporting, Binance.US, Binance, and Zhao have been facing multiple hurdles from regulatory bodies in the U.S. and abroad. The U.S. Securities and Exchange Commission (SEC) filed a complaint against the company and its CEO over supposedly breaking securities laws in the country.
As a result, Binance.US has been losing market share to competitors while trying to reduce Zhao’s stake in the company. But this crypto exchange is hardly the only one facing regulatory issues, as the SEC and other regulators rush in to enforce their approach to a regulatory framework.
As of this writing, BNB’s price trades at $245 following a persistent downtrend on high timeframes.
Cover image from Unsplash, chart from Tradingview