In a significant shift from its once laissez-faire approach, Binance, the world’s largest cryptocurrency exchange, is now on a mission to become a model of regulatory compliance. The company announced on Friday that it expects to have 645 full-time compliance staff by the end of the year – a notable 34% increase from last November. With contractors included, Binance’s team dedicated to ensuring adherence to an ever-evolving landscape of global regulations will exceed 1,000.
This concerted focus on playing by the rules marks a dramatic pivot for Binance, which just over a year ago agreed to pay a staggering $4.3 billion in penalties to various US regulators for violations of the Bank Secrecy Act (BSA) and knowingly allowing users to evade international sanctions. As part of the settlement, founder and then-CEO Changpeng “CZ” Zhao stepped down and was sentenced to four months in prison for the BSA breaches.
New Leadership, New Priorities
CZ’s successor, Richard Teng, a former regulator in Singapore and the United Arab Emirates, has been outspoken about transforming Binance into a regulatory compliant operation – something he sees as non-negotiable for the company’s long-term sustainability. While Teng’s brief tenure has undoubtedly accelerated Binance’s compliance efforts, the exchange began its push to appease regulators before Zhao’s departure in November 2023.
Key Compliance Hires
Tigran Gambaryan, Binance’s head of financial crime compliance, left the Internal Revenue Service (IRS) in 2021 to join the exchange. Noah Perlman, Binance’s chief compliance officer, came on board in January 2023. That year, Binance boosted its compliance spending by 36%.
“Our industry has entered a paradigm shift and new era of maturation where regulatory compliance is a critical benchmark for user experience and protection, business success, and responsible growth,” said Perlman.
– Noah Perlman, Binance Chief Compliance Officer
Some of Binance’s recent compliance hires have included individuals with extensive careers in traditional finance and government:
- Todd McElduff, Binance’s new enterprise compliance director, will lead the exchange’s engagement with global law enforcement agencies. He previously headed the global financial crimes oversight division at PayPal and a financial crime division at Morgan Stanley.
- Céline Inial and Caner Akyürek joined as special investigations specialists for France and Turkey respectively, each with nearly 20 years of law enforcement experience in their countries.
Protecting Users & Industry Standards
“We are actively recruiting for top compliance talent to bolster our industry-leading compliance program and team to match the demands of our rapidly maturing sector as global crypto adoption also rapidly grows,” Perlman noted. “We pride ourselves on leading industry standards in protecting users and the growth of our compliance team ensures we continue to safeguard our global user base of over 240 million.”
As cryptocurrency moves from the fringes of finance into the mainstream, major players like Binance are realizing that survival means not just innovating, but collaborating with regulators. The exchange’s supersized investment in compliance suggests an understanding that in an industry still finding its footing, those who help write the rules may have the best chance of thriving under them.
But will a larger compliance department be enough to satisfy wary governments worldwide? While an encouraging development, Binance’s shift may need to be accompanied by a broader industry-wide commitment to transparency and consumer protection. For now, the crypto giant appears determined to lead by example, recognizing that in the rapidly evolving world of digital assets, the price of growth may well be playing by the rules.
