Binance, the world’s largest cryptocurrency exchange, acknowledged last week their involvement in breaching anti-money laundering regulations, unlicensed money transmitting activities, and violations of sanctions in a legal agreement reached with the US Department of Justice, including a few other agencies.

The company has agreed to pay a significant $4.3bn fine as part of this settlement, including strengthening its compliance program and appointing an independent monitor for three years.

In addition, as a consequence of personal charges brought against him, Changpeng Zhao (CZ), co-founder and former CEO of Binance, will be required to pay fines totaling $50mn. CZ pleaded guilty to the charges in a Seattle court, after which he was released on a $175mn bail, of which $15mn must be held in a trust account. CZ faces up to 18 months in prison for the violations, with the sentencing hearing scheduled for February 23 next year.

As part of the agreement, CZ will be prohibited from any involvement with Binance for three years. As a result, he will be resigning as CEO, and Richard Teng, a former Abu Dhabi financial regulator and long-serving Binance executive, will take over his position. CZ will, however, still retain majority ownership of Binance.

It could have been FTX but worse

Initially, this settlement may seem like a significant setback for the cryptocurrency industry.

It is not. In fact, it is positive.