As of the morning of November 25th, the price of Bitcoin fluctuated at $37,750, the highest level in 2023, according to Coin Metrics. In the past week, the world’s largest cryptocurrency has increased by 3.6%.
The second largest cryptocurrency, Ethereum, has increased by 6.5% in the past week, reaching $2,080.
The other cryptocurrencies in the top 10 have had mixed performances. Cardano increased by 6.8%, Ripple and Solana increased by 1.5%, while Tron advanced by 1.7%. On the other hand, Dogecoin decreased by 7.5% and BNB dropped by 3.9%.
Top 10 Cryptocurrencies Performance:
Source: CoinMarketCap
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Binance admits to money laundering
BNB, the cryptocurrency of Binance, has plummeted over the past week after Binance has admitted to money laundering and its founder, Changpeng Zhao (CZ), has resigned.
Binance will pay a fine of $4.3 billion, which is one of the largest penalties against a company in the history of the United States. Meanwhile, Zhao will pay a fine of $50 million and step down as CEO according to the agreement. Despite stepping down, the agreement allows CZ to retain a majority ownership of the company.
The founder of Binance has admitted to violating the Bank Security Act before a federal court in Seattle. With this agreement, the Department of Justice, the Department of the Treasury, and the Commodity Futures Trading Commission (CFTC) have ended the years-long investigation into the world’s largest cryptocurrency exchange.
“Today, I am stepping down as the CEO of Binance. It must be said that letting go is never easy, but it is the right thing to do. I have made mistakes and I must take responsibility. This is the best thing for the community, for Binance, and for myself,” Changpeng Zhao (CZ) wrote on the social media platform X on November 21st. He believes that “Binance is no longer a child” and it is time to let it walk and run on its own.
The exchange has been charged with three offenses, including anti-money laundering regulations, operating an unlicensed money transmitting business, and violating US sanctions. Binance is being criminally fined $1.8 billion and its assets valued at $2.5 billion have been seized, according to court records that were unsealed on Tuesday.
Notably, the exchange has admitted to facilitating transactions with Hamas and other terrorist organizations on its platform. Binance also allowed at least $1.1 million worth of transactions between its customers in the US and Iran, according to the records.
On the same day, Zhao also announced that Richard Teng, the former CEO of the Global Markets Division at Binance, has been appointed as the new CEO of Binance. According to Zhao, Richard is a high-level leader with over three decades of experience in financial services and management, and he will ensure that Binance carries out the next phase of security, transparency, compliance, and growth.
“So what happens next? I will take some time off. I haven’t taken a real vacation in over 6 and a half years,” CZ said. He also feels that he will not become the CEO of any more start-up companies but instead will make some investments and become a shareholder in a few startups in the fields of Web3, blockchain, DeFi, AI, and biotech, as well as being ready to advise a few entrepreneurs.
Over $1 billion withdrawn from Binance
In the 24 hours following the shock at Binance, users withdrew over $1 billion from the exchange, not including Bitcoin-related funds, according to data from blockchain research company Nansen.
The capital outflow occurred after Binance founder Changpeng Zhao, also known as CZ, pleaded guilty to money laundering and resigned as CEO on November 22nd. In addition, liquidity has decreased by 25% as market participants withdraw their positions, according to data provider Kaiko.
Nevertheless, Binance remains the largest cryptocurrency exchange in the world, processing transactions worth billions of dollars annually. According to Nansen, Binance has more than $65 billion in assets, meaning the exchange has enough capital to withstand a sudden wave of investor withdrawals.
“The shock of Binance’s plea agreement and admission of money laundering has not had a major impact on the cryptocurrency market,” said Grzegorz Drozdz, a market analyst at an investment firm. “The cryptocurrency that has decreased the most within the past 24 hours is BNB. With the top 100 cryptocurrencies currently, 98 of them have shown significant recovery, with Bitcoin only decreasing by 1.3%,” he said.
According to Drozdz, the positive aspect for the cryptocurrency industry at this time is that it has resolved issues with regulatory authorities who are now behind Binance, and the company is committed to strengthening security measures.
“The information about Binance, along with the possibility of approving the Bitcoin ETF fund, may have a positive impact on the cryptocurrency market in the long run,” Drozdz added.
