The prices of prominent cryptocurrencies, such as bitcoin and Binance Coin, experience a decline following the emergence of reports indicating that Changpeng Zhao, the founder and CEO of Binance, pleaded guilty in connection with charges of money laundering and several other criminal offenses.
This admission was made as part of a substantial settlement, worth billions of dollars, reached between Zhao and regulatory authorities in the United States.
Binance coin saw a drop of almost 6% after an earlier increase of up to 5% during the day. These value swings were caused by investors optimistic about the resolution of the ongoing multi-year investigation into the world’s largest cryptocurrency exchange.
In the wake of the market decline, investors held long positions BNB experienced widespread liquidation. At the time of writing, BNB’s long liquidations were approaching $3 million within an hour of the Binance developments being announced.
The impact of the action had a significant impact on the remaining cryptocurrency market. The leading digital currency, Bitcoin (BTC), saw a decline of 1.55% to remain slightly below the $37,000 mark. In the same vein, Ethereum (ETH) recorded a decline of around 2%, reaching $1,993.
Additional cryptocurrencies, like Ripple (XRP), saw a decline of 3.2%. Similarly, Solana witnessed a decline of almost 4%, while Polygon and Uniswap recorded losses of 7.6% and 3.6% respectively.
Zhao is currently facing charges of violating anti-money laundering laws, a charge for which he admitted responsibility after his resignation.
Today I stepped down as CEO of Binance. Admittedly, it wasn’t easy to let go emotionally. But I know it’s the right thing to do. I made mistakes and I have to take responsibility. This is what is best for our community, for Binance and for myself.
Binance is no longer a baby. It is…
— CZ 🔶 Binance (@cz_binance) November 21, 2023
Additionally, Binance has agreed to a $4.3 billion settlement with US authorities, which is one of the largest, if not the most important, resolutions in the history of the cryptocurrency market.
The latest FOMC minutes also appear to have forced investors to act cautiously in light of ongoing market concerns, which is why cryptocurrency prices fell today.
In particular, the price declines of most of the major cryptocurrencies suggested that investor views could be changing.
Market cap of cryptocurrencies at $1.35 trillion. Chart: TradingView.com
Meanwhile, despite the early price declines, some industry observers believe the Binance scenario could further fuel the recent surge in cryptocurrency prices.
According to Jeff Embry, the managing partner of Globe 3 Capital, a crypto hedge fund, the reported settlement involving Binance is significant in the context of addressing the fallout and correcting the negative effects of the bear market.
“Bear markets flush out a lot of the bad companies, business practices, inefficiencies and bad actors,” he said.
Fineqia Research Analyst Matteo Greco said the crypto industry will benefit in the long run from Changpeng Zhao’s resignation and Binance agreeing to pay a fine of $4 billion or more.
(The content of this site should not be construed as investment advice. Investing involves risks. When you invest, your capital is subject to risk).
Featured image from Shutterstock
