Binance France recently changed ownership following a warning from the Financial Markets Authority (AMF). Former CEO Changpeng Zhao had to step down to allow the company to retain its French license.
In-depth reshuffle at Binance France after AMF warning
Binance France, a subsidiary of the global crypto giant, recently underwent a major change of ownership. Indeed, this decision follows a warning issued by the AMF last December. The stock market watchdog indicated that Changpeng Zhao, the former CEO of Binance, could no longer remain the beneficial owner of the company.
This action follows investigations by the U.S. Department of Justice, the Commodity Futures Trading Commission (CFTC), and the U.S. Treasury's Financial Crimes Enforcement Network. Mr. Zhao pleaded guilty to charges in the United States in November and was sentenced to prison.
To comply with the requirements of the AMF and maintain its French license, Binance France had to find new shareholders. The company announced that the new owners now own 100% of the company equally.
The French subsidiary has not publicly communicated the names of the new beneficiaries. However, the Pappers news service has identified Lihua He and Yulong Yan as the new owners. Both of these individuals are founding members of Binance, with Yan also identified as Allan Yan, Binance's first chief product officer.
A regulatory journey strewn with pitfalls
The change of ownership occurs in a complex regulatory context for the exchange in Europe. The company received approval from the AMF in May 2022, allowing Binance France to legally operate in the country. VS
However, the AMF granted this approval after accusing Binance of violating anti-money laundering rules, even before Zhao was indicted in the United States. According to the European Regulation on Crypto-Asset Markets (MiCA), this license would allow Binance to transfer its operations to the 27 member countries of the European Union.
However, after the CFTC filed a lawsuit against Binance in March 2023, the French subsidiary faced difficulties establishing local banking partnerships. This situation was further complicated following the departure of several senior executives in October 2023, including Stéphanie Cabossioras, the executive director of Binance France.
In June 2023, Dutch authorities refused to grant Binance a virtual asset service provider license. Later that same month, Belgian regulators forced the exchange to suspend its activities on their territory.
As the crypto sector experiences unprecedented regulatory adoption, Binance will need to redouble its efforts to review its governance and reassure the authorities. This change of owners in France seems to be a first step in this direction.
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