U.S.-based crypto exchange Binance.US wants to improve its standing with regulators, and the exchange’s ties to Changpeng Zhao (CZ) isn’t making that easier. Now, the company is reportedly looking into how it can bring down Zhao’s ownership stake.
According to a Thursday report from The Information, people familiar with the matter revealed that executives at the firm are exploring how a decrease in Zhao’s ownership might lead to an improved perception of the company, especially in the eyes of regulators.
Zhao has been a part of these discussions and had been looking to offload his shares since last summer, much before the U.S. Commodities and Futures Commission (CFTC) brought an enforcement action against the exchange.
The CFTC lawsuit filed in March charged Binance and Zhao with violating trading and derivatives regulations, and alleged that executives at the exchange had taken a calculated approach to increase its presence in the country.
Earlier that month, U.S. Senators Elizabeth Warren, Chris Van Hollen and Roger Marshall penned a letter addressed to Zhao, questioning his claims over Binance.US being completely independent to Binance.
The Senators even went so far as to compare Zhao’s claims to those made by FTX’s former CEO Sam Bankman-Fried over FTX.US and the international entity, calling the assertion “eerily similar.”
Binance is the world’s largest centralized crypto exchange, with over $8.5 billion in daily trading volume. Its U.S. subsidiary ranks much lower by comparison, with just over $135 million worth of trading volume over the same period.
