Richard Teng, the newly appointed CEO of Binance, has hinted at the exchange’s financial capability to pay the $4.3 billion fine imposed by the U.S. Justice Department. Teng, who took over from Changpeng Zhao, emphasized the strong fundamentals of Binance’s business, citing its position as the world’s largest crypto exchange by volume, a debt-free capital structure, modest expenses, and robust revenues and profits.
The statement from Teng came in response to a tweet by Connor Lango, director of business development at Coinbase, who suggested that Binance could likely pay the full $4.3 billion Department of Justice (DoJ) fine without selling any crypto assets. Lango pointed out that after extracting Binance’s crypto holdings from their Proof of Reserves, the exchange still held $6.35 billion in total assets and $3.19 billion in stablecoins.
Despite Teng’s reassurances, Binance has experienced significant outflows, totaling more than $900 million in the past 24 hours. Data from DeFi TVL aggregator DefiLlama indicated $605 million in net outflows over the past week, although the exchange still recorded net inflows of $1.78 billion over the past month, the highest among centralized crypto exchanges.
The fundamentals of our business are VERY strong.
Binance continues to operate the world's largest crypto exchange by volume, our capital structure is debt-free, expenses are modest, and, despite the low fees we charge our users, we have robust revenues and profits. https://t.co/PHq2YS0CP5
— Richard Teng (@_RichardTeng) November 22, 2023
This development follows Binance’s guilty plea to criminal charges related to anti-money laundering and violations of U.S. sanctions, part of a comprehensive agreement with the Department of Justice allowing the exchange to continue its operations. As part of the settlement, Changpeng Zhao, Binance’s previous CEO, will personally pay $200 million in fines and may face a maximum prison sentence of 10 years.
Richard Teng’s appointment as CEO was expected, with reports in June suggesting he was a frontrunner for the position amid Binance’s regulatory challenges. Teng, with a background including senior positions at Singapore’s central bank and Abu Dhabi’s international free-trade zone, is seen as instrumental in guiding Binance through the current regulatory landscape. Despite a setback in securing a crypto license in Singapore, Teng’s rise within Binance has positioned him as a key figure within the organization.