Risks in Binance’s global compliance and regulatory settlements
Binance faces significant legal challenges including a $10 billion Nigeria SEC settlement and money laundering investigations in France. CEO Richard Teng is leading a global compliance restructuring as the exchange manages various licensing withdrawals and regulatory pressures.
Nigeria tax charges and French money laundering probes
The Nigerian federal government filed legal action against Binance to uphold fiscal responsibility and preserve economic integrity, alleging non-payment of Value-Added Tax, failure to file tax returns, and complicity in helping customers evade taxes. Specifically, Binance failed to issue invoices for VAT purposes, which hindered the determination of taxes for subscribers. The Central Bank of Nigeria blames the exchange for the naira depreciation against the dollar. Security authorities detained Tigran Gambrayan, an American, and Nadeem Anjarwalla, a British Kenyan. In France, the Paris public prosecutor’s office investigated Binance for aggravated money-laundering and illegal digital asset services between 2019 and 2024. This probe examines whether Binance operated as a digital asset service provider before receiving regulatory approval in May 2022. The investigation examines the advertising of services through influencers without proper registration. Binance denies the allegations and claims it holds a Digital Asset Service Provider registration with the Autorite des Marches Financiers. Users also complained to French authorities that the platform provided incorrect information, which caused investment losses. The French investigation follows reports that tens of millions of dollars from the dark-web market Hydra were deposited into Binance accounts through Bitzlato. Binance claims Nigeria is "not yet" one of its top markets despite its "extraordinary potential."
US settlement and compliance shifts
Richard Teng replaced Changpeng Zhao as CEO after Zhao pleaded guilty to violating US anti-money laundering laws. Binance reached a settlement in November 2023 that included a $1,805,675,163 criminal fine and $2,510,650,588 forfeiture to the US Department of Justice. This settlement also included a five-year monitorship from the US Treasury and a three-year independent monitor from the Department of Justice. The CFTC settlement addressed violations including operating an illegal digital asset derivatives exchange for US customers and inadequate know-your-customer controls, totaling $2.85 billion including $150 million from Zhao. The SEC dismissed its civil action against Binance Holdings Limited and BAM Trading Services Inc. with prejudice on May 29, 2025. Zhao served four months in federal prison in 2024.
| Agency | Penalty Type | Amount |
|---|---|---|
| US DOJ | Criminal Fine and Forfeiture | $4,316,126,163 |
| US Treasury | Settlement | $3.4 billion |
| CFTC | Total Settlement | $2.85 billion |
Teng stated that compliance provides a competitive advantage for the exchange. The company spent hundreds of millions of dollars on compliance and established a global board of directors with three independent directors. In 2025, Binance processed $34 trillion in trading volume across all products and reached over 300 million registered users worldwide. You already know that regulators in the European Union aim for tighter oversight of digital assets. Will the current compliance spending prevent further litigation in the United States?
Global licensing withdrawals and market departures
Binance withdrew its license application for BV Investment Management in Abu Dhabi on November 7. The company stated the application was not necessary following an assessment of global licensing needs. The firm insisted the decision was unrelated to the legal issues Binance faced in the United States. Binance still applies for a license in Dubai with the Virtual Asset Regulatory Authority. The exchange also left the Dutch market because it failed to obtain a license from the central bank. This caused Dutch residents to only be able to withdraw assets after July 17. Binance withdrew from Cyprus and Germany and ceased operations in Belgium.
The exchange operates through three distinct licensed entities in Abu Dhabi: Nest Exchange Ltd for on-exchange activities, Nest Clearing and Custody Ltd for custody, and Nest Trading for off-exchange offerings. The company stopped accepting new users in the United Kingdom and faces a process from the regulator in the Philippines to block access. In Australia, the corporate watchdog sued the derivatives business because it misclassified more than 500 retail clients as wholesale investors between 2022 and 2023. The company also announced it would sell its Russia business following regulatory pressure.
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