In a landmark ruling, the U.S. District Court for the District of Northern Illinois approved the settlement between Binance, the world’s largest cryptocurrency exchange, and the Commodity Futures Trading Commission (CFTC). The resolution follows a series of legal actions launched by the CFTC in March, resulting in penalties totaling $2.85 billion for the exchange and its former CEO Changpeng Zhao.

It is reported that the court personally imposed a civil penalty of US$150 million on Changpeng Zhao, ordered Binance to refund US$1.35 billion in illegal transaction fees, and also imposed a fine of US$1.35 billion on the company, for a total of US$2.85 billion.

The settlement ends a long-running conflict between regulators and cryptocurrency trading platforms. The CFTC originally filed charges against Binance and Zhao in March 2023, accusing them of evading federal law and operating an illegal derivatives exchange.

Potential 18-month sentence looms

As part of the settlement agreement, Zhao agreed to resign as CEO of Binance on November 22. The decision is an important part of a broader settlement with the U.S. Departments of Justice, Treasury and the U.S. Commodity Futures Trading Commission. On the same day, Zhao pleaded guilty to multiple civil charges and one criminal charge related to anti-money laundering laws.

On the criminal charges, Zhao could face up to 18 months in prison. As part of the settlement, he agreed not to appeal the lengthy sentence.

Founded in 2017, Binance is a global cryptocurrency exchange that provides a trading platform for more than 100 cryptocurrencies.