The first-ever appointment of a board of directors by Binance, the most heavily traded cryptocurrency exchange in the world, is a major step towards restructuring the company’s operations.
The exchange pleaded guilty to US charges relating to anti-money laundering (AML) and sanctions breaches last year, prompting this step.
Bloomberg states that there are seven members on the board, with Gabriel Abed, who was formerly Barbados’ ambassador to the UAE, serving as chairman. Along with Binance CEO Richard Teng, three other corporate executives—Heina Chen, Jinkai He, and Lilai Wang—form the board of directors.
Xin Wang, CEO of Bayview Acquisition Corp., and Arnaud Ventura, Managing Partner of Gojo & Co., are two outside members of the exchange’s newly appointed board of directors.
Among Binance’s initial staff members are Chen, He, and Wang, who have allegedly been there from the exchange’s start. In addition to being a co-founder and senior executive of Binance, Wang is in charge of developing the exchange’s technology.
Regarding the make-up of the board, a few specialists have voiced their opinions. Company insiders making up the majority of a board show “resistance” to outside management and supervision, according to Austin Campbell, a consultant for blockchain companies and adjunct professor at Columbia Business School.
Campbell adds that there may not be the best solution due to the purported “absence of independent members” with “deep” expertise in regulated financial risk and compliance. Nevertheless, he recognizes that the board nomination is a positive development and stresses the need for “effective governance” going forward.
Binance is undergoing a period of profound transformation since Richard Teng assumed the role of CEO in November, and the selection of the board is only one example of this. According to Bitcoinist, Teng took over after Binance and US authorities reached a deal.
Bloomberg reports that the exchange is still mum on its planned worldwide headquarters, but that the establishment of the board is indicative of the company’s attempts to adopt a more traditional corporate structure.
In February, a US court accepted a plea agreement that led Binance to agree to pay $4.3 billion. Binance founder Changpeng Zhao (CZ) admitted guilty to charges connected to anti-money laundering and sanctions breaches, which were part of the prosecution against Binance. The settlement was a part of that case. Sentencing for Zhao is scheduled for about April 25.
Binance has reached a major turning point in its continuous evolution with the establishment of a board of directors.
Binance plans to tackle regulatory issues and restore confidence in the cryptocurrency sector by strengthening governance and compliance procedures. The success of the firm in navigating the ever-changing digital asset ecosystem will depend on how well the board guides its future undertakings.
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