Binance Co-CEO Appointment Sparks Debate Over Changpeng Zhao’s Management Role

Binance has appointed Yi He as co-CEO, raising significant questions about the future influence of founder Changpeng Zhao. After Zhao’s guilty plea to a federal crime in 2023, he agreed to a three-year management ban, but a recent presidential pardon may complicate matters.

Key Takeaways

Yi He has been named co-CEO of Binance, sparking questions about Changpeng Zhao’s influence.
Zhao pleaded guilty to a federal crime in 2023 and agreed to step down for three years.
A presidential pardon may challenge the enforcement of Zhao’s management ban.
Legal experts are divided on the impact of the pardon regarding Zhao's operational control at Binance.
Binance is reportedly in negotiations with the DOJ to conclude the monitorship sooner.

Binance co-CEO move revives questions over Changpeng Zhao’s control - 1

Changpeng Zhao's Possible Return to Binance

Binance, the leading cryptocurrency exchange, has appointed Yi He as co-CEO, igniting debates about the ongoing influence of founder Changpeng Zhao, widely known as CZ. This decision comes on the heels of Zhao's 2023 agreement to step down from his management position as part of a plea deal.

In 2023, Zhao pleaded guilty to a federal offense which resulted in him agreeing to resign as CEO of Binance. As part of this plea agreement, he is required to avoid involvement in Binance's global operations for three years, under government supervision, as outlined in court documents.

Yi He, who shares children with Zhao and co-manages the family's investment office YZi Labs, now shares co-CEO responsibilities with him. The name "YZi" reflects both her given name and Zhao's surname, emphasizing their partnership.

Bloomberg reports that Zhao retains ownership of about 90% of Binance and approximately 86% of its U.S. subsidiary. He continues to promote Binance on social media, indicating his ongoing association with the company.

The effectiveness of Zhao's commitment to an absence from management is now in question following a presidential pardon he received, which dismissed his federal criminal conviction and reinstated his civil rights lost due to his felony status, according to experts.

Legal analyses vary on the pardon’s implications. Some legal commentators suggest that this act could weaken the Department of Justice's and U.S. Treasury's efforts to enforce the management ban, while others maintain that Zhao's prior agreement to abstain from executive responsibilities may still be in effect unless there is a formal revocation by the White House.

Sources have indicated that Binance is currently in talks with the DOJ to potentially lift the monitorship ahead of schedule, although neither the DOJ nor Binance has commented on these negotiations.