Binance has been through quite the ordeal this year. The company, still the most popular exchange in the world, has continued to face issues with regulators in different jurisdictions.
With the company now looking to turn a new leaf, it is doing the same thing that many organizations do - change its leadership, one at a time.
Something New Happening Down Under
To be fair, the changes haven’t affected Binance’s biggest cadre yet. However, the company has engaged in some swift changes in the past few weeks.
The hiring spree particularly started in August, when Binance’s Australian subsidiary announced the hiring of Leigh Travers - the former chief executive of blockchain and payments company DigitalX - as its new CEO. Before then, Travers had spent seven years working at DigitalX, and he worked at Blockchain Australia - the country's blockchain industry agency.
Travers had been influential in making DigitalX the world’s first publicly listed blockchain company. In 2014, the company completed a reverse takeover of Macro Energy Ltd. - a company listed on the Australian Stock Exchange. The takeover allowed DigitalX to finally go public.
Travers claimed that he will be looking to improve Binance Australia's relationship with the Australian regulatory agencies in his new role.
“We have a responsibility to be involved in helping to shape the growth of our industry, and this means prioritizing engagement and conversations with policymakers and regulators. From an industry perspective, I know it’s imperative that we continue to develop our relationships with regulatory bodies while reinforcing our company commitment to compliance and best practice,” Travers said in part.
The new CEO will definitely have his work cut out for him because things have gotten worse for Binance in Australia. A few weeks after Travers’ appointment, the exchange confirmed that it would be ceasing crypto options and futures trading for Australian users.
In an announcement, Binance said that Australian users have 90 days to cut down on or close their positions entirely. This will cover products like futures, options, leveraged tokens, and more. As of right now, Australian users can’t increase or open new positions for derivatives on Binance. While they can still top their balances to prevent margin calls, that’s the best they can do for now.
The users will have until December 23 to reduce or close their positions. After then, all remaining positions will automatically be closed. In its announcement, Binance claimed that it remains committed to building relationships with regulators. But, a closure of derivative products on its platform is the best way forward for now.
A Shakeup for Binance US
Besides Travers, Binance has made yet another big hire. Late last month, the exchange announced that it had hired Tigran Gambaaryan, a former agent at the Internal Revenue Service (IRS), to lead its new intelligence division. Binance will be Gambaryan’s first private-sector employer since 2011.
During his time at the IRS, Gambraryan was involved in national security, tax evasion, and terrorism financing investigations. He was instrumental in the investigation of Silk Road - the famous Dark Web marketplace for illicit firearms, drugs, and more. Silk Road facilitated some of the earliest known Bitcoin transactions, and it was eventually shut down in 2013. Its creator, Ross Ulbricht, currently serves a double life sentence plus 40 years.
In his new role, Gambaryan will focus on investigations looking to prevent financial loss and security threats. He will lead the company’s audit and investigations team and also work with regulators and law enforcement agencies. With his experience as a federal agent, he is definitely a good hire.
Gambaryan’s hiring particularly suggests that Binance is looking to improve its relationship with regulators. The company appears to have gotten tired of regulatory squabbles, and it could feel that the time has come to do better.
The move is especially important as Binance’s United States subsidiary - Binance US - will be looking to go public in some years. Changpeng Zhao, the company’s CEO, told The Information that a public offering for Binance US is definitely in the cards. For now, the company will be looking to make such a move in the next three years.
Zhao explained that Binance US is currently looking to close a massive private funding round that will give it more autonomy from Binance as a whole. The funding round should make the subsidiary a unicorn on its own, putting it in a much better position to go public. It shouldn’t be so difficult, with Binance US making between $800 million and $1 billion in profits last year alone.
The CEO also pointed out that they are working on crossing the several regulatory hurdles they currently face. When they can do this, they’ll feel more confident about a public offering. These hires - as well as any more that could follow - appear to be the first step in that regard.