Amid SEC and CFTC Lawsuits, Binance CEO Defends Brian Shroder’s Resignation as Normal, states that they are ‘taking a deserved break’.
Changpeng Zhao (CZ), the chief executive officer of Binance Holdings, has refuted rumors about Binance’s departure. After a fruitful tenure with the company, US CEO Brian Shroder stated that he is “taking a well-deserved break.”
The Binance exchange.US is a subsidiary of Binance Holdings, and a handful of other senior executives have recently resigned from the U.S.-based exchange in response to lawsuits from the Securities and Exchange Commission and Commodities Futures Trading Commission.
In a statement released via X (Twitter) on September 15, CZ urged people to “ignore FUD” regarding the recent reorganization of executives and indicated that Shroder was leaving the company amicably after accomplishing everything he ‘set out to do when he joined two years ago.”, he also added that:
‘Under his leadership, Binance.US raised capital, improved its product and service offerings, solidified internal processes, and gained significant market share, all of which helped to build a more resilient company for the benefit of customers. We are grateful for his contributions
There has been some speculation regarding recent management changes at @BinanceUS. Brian Shroder is taking a deserved break after accomplishing what he set out to do when he joined two years ago. Under his leadership, https://t.co/hSHrrlF7o7 raised capital, improved its product…
— CZ 🔶 Binance (@cz_binance) September 15, 2023Both the SEC and CFTC have filed litigation against Binance for alleged violations of SEC and CFTC laws, including the sale of unregistered securities and the mismanagement of customer funds. The SEC alleged in its lawsuit that the US and international branches of Binance unlawfully commingled funds.
Amid this litigation, Binance.US announced on September 13 that it was laying off one-third of its employees and that Shroder was resigning as CEO. On September 14, two more executive departures were reported, as the head of legal affairs, Krishna Juvvadi, and the chief risk officer, Sidney Majalya, decided to leave the organization. The departures sparked rumors on Twitter that Binance may have more severe legal issues than previously believed.
Referring to the lawsuits in his X post, CZ also asserted that the crypto market “is in a different place now than it was two years ago,” as crypto firms face an “increasingly hostile regulatory environment.” According to him, Norman Reed, the new CEO of Binance.US, is the “right person” to head the US exchange in this new era.
Binance is the world’s largest cryptocurrency exchange by trading volume. Since the third-largest exchange, FTX, went insolvent in November and its executives were charged with fraud, it has come under increasing scrutiny.
Critics assert that Binance must sufficiently disclose its business practices or demonstrate its financial stability. However, CZ has shrugged off these concerns, stating that the firm has “no liquidity issues” and that claims against it are unfounded.
