Binance plans to have a 700-strong compliance workforce by the end of 2024. | Source: Bloomberg3 min read Last Updated : Aug 22 2024 | 9:33 PM ISTBy Olga Kharif
Binance Holdings Ltd. is hiring 1,000 people this year with many earmarked for compliance roles as the crypto exchange’s annual spending to meet regulatory requirements, including US oversight under a plea deal, tops $200 million.
Chief Executive Officer Richard Teng, who is visiting the US to talk to monitors and officials, outlined the employment goals for the world’s largest crypto trading platform in an interview with Bloomberg News in New York on Wednesday.
“I’ve been a regulator all my life,” Teng said. “Government agencies are important.” He declined to say whether he has met with the Securities and Exchange Commission during his trip. The SEC is suing Binance and wasn’t part of the US settlement.
That plea deal with the Justice Department and other US agencies included a $4.3 billion penalty for failures that let criminals and terror groups use the exchange. The firm faces years of compliance monitoring by the DOJ and the US Treasury’s Financial Crimes Enforcement Network.
Compliance Workforce
Binance plans to have a 700-strong compliance workforce by the end of 2024, up from about 500 currently, said 55-year-old Teng. His career includes stints as a senior regulator at the Monetary Authority of Singapore as well as at the city-state’s SGX stock exchange. He was also chief executive officer of the regulator at Abu Dhabi’s international financial center.
Teng said Binance fields a growing number of requests from law-enforcement agencies worldwide, numbering 63,000 so far this year, up from 58,000 in 2023.
Spending on compliance has climbed from $158 million two years ago and is set to increase further, he said. The monitors appointed by the US agencies, Forensic Risk Alliance and Sullivan & Cromwell, have already begun work.
“They’re going to do an assessment,” Teng said. “We’re very early in the journey.” The monitors keep an eye on the company’s anti-money-laundering and transaction-tracking efforts, he added.
In June, a judge ruled that the bulk of the SEC lawsuit against Binance and its billionaire co-founder Changpeng “CZ” Zhao can proceed. The SEC sued Binance and Zhao in 2023 for mishandling customer funds, misleading investors and regulators, and breaking securities rules. The defendants contested the claims and asked for the case to be dismissed. Teng said Binance will continue to fight the accusations.
Teng took over as Binance’s chief executive after Zhao stepped down as part of the US plea deal. Zhao was subsequently sentenced to a four-month jail term.
Teng’s Changes
Under Teng, Binance has adjusted the way it works with prime brokers, tightened requirements for listing new digital tokens and spun off its venture arm. But the company has yet to formally designate a global headquarters or release a fully audited set of accounts.
Teng said the business continues to be profitable and that Dubai, Abu Dhabi and another city he declined to specify are on a short-list of potential locations for the headquarters. A company spokesperson two months ago said Binance’s headcount was upwards of 5,000 staff.
The planned hiring spree also encompasses customer service roles, according to Teng. The expansion follows a rebound in crypto prices and trading volumes from a bear market in 2022 that led to a spate of job losses across the sector.
First Published: Aug 22 2024 | 9:33 PM IST
https://www.business-standard.com/markets/cryptocurrency/binance-holdings-to-hire-1-000-people-as-compliance-spending-tops-200-mn-124082201362_1.html
