Binance Holdings Ltd., the world’s largest cryptocurrency exchange, is reportedly engaged in talks with the US Department of Justice (DOJ) to potentially remove a key compliance oversight requirement that was part of its record $4.3 billion settlement over money laundering allegations. The discussions, reported widely in September 2025, center on ending the three-year external monitorship imposed after Binance acknowledged failing to prevent money laundering through its platform.
Background on the DOJ Settlement and Oversight
In 2023, Binance agreed to pay $4.3 billion in one of the largest corporate penalties in US history to resolve criminal and civil allegations that it did not implement adequate anti-money laundering (AML) controls. As part of this settlement, Binance accepted the appointment of an independent compliance monitor for a three-year period. This monitorship was intended to ensure improved compliance with laws designed to prevent illicit financial activity and to guard against repeat violations.
Binance’s founder Changpeng Zhao (known as “CZ”) served a four-month prison sentence following a guilty plea related to these charges, making the case highly notable both for its scale and the founder’s direct legal consequences. Zhao has sought a presidential pardon and was involved in politically connected ventures, including collaborations linked to the Trump family.
Reasons for Revisiting the Oversight Requirement
The DOJ’s reconsideration of Binance’s monitorship appears to be part of a broader reassessment of the use and effectiveness of corporate monitors in settlements. Matthew Galeotti, head of the DOJ’s Criminal Division, issued a memo earlier this year signaling concerns that mandatory oversight can impose significant costs and disrupt lawful business operations while weighing its benefits in preventing repeat misconduct. Under the Trump administration, there has been a trend toward reducing or ending monitorships imposed under previous administrations.
Past examples include the removal of monitorships for other large companies such as Glencore Plc, NatWest Group Plc, and Austal USA, with costs of monitoring cited as high as $142 million over recent years. The DOJ has in such cases moved toward enhanced compliance reporting as an alternative to ongoing external oversight.
Current Status and Implications
While no final decision has been reached at the time of reporting, federal prosecutors are in confidential talks with Binance to potentially eliminate the external monitor condition in its settlement. If approved, Binance would likely still be subject to enhanced reporting and internal compliance obligations as substitute safeguards.
Notably, Binance remains under a separate monitoring requirement from the US Treasury Department’s Financial Crimes Enforcement Network (FinCEN), which requires ongoing oversight independent of the DOJ monitorship. This dual oversight underscores the continuing regulatory scrutiny the exchange faces despite potential changes in DOJ conditions.
The reconsideration of Binance’s oversight conditions also intersects with recent political and regulatory shifts. The Securities and Exchange Commission (SEC) under the current administration has reportedly paused or abandoned multiple investigations into crypto firms, including Binance. Additionally, Binance’s ties to crypto-friendly policies promoted by the Trump administration and its ventures such as the stablecoin project with World Liberty Financial—a firm linked to Trump’s family—add a complex geopolitical dimension to the legal case.
Neutral perspective on impact and industry context
The possible removal of the DOJ’s compliance monitor on Binance may reflect evolving DOJ policy on corporate oversight, aiming to balance enforcement rigor with minimizing undue business disruption and financial burden. Experts acknowledge that while corporate monitors can help prevent recidivism, the cost-effectiveness and practical benefits are increasingly scrutinized, particularly in fast-moving industries like cryptocurrency exchanges.
For the cryptocurrency market and regulatory landscape, the outcome of these discussions will be significant. Binance’s settlement remains the largest enforcement action against any crypto exchange to date. Changes to the monitorship may influence future approaches to compliance enforcement in the crypto sector, which continues to grapple with AML challenges and regulatory uncertainties worldwide.
- Binance is negotiating with the DOJ to remove the three-year external compliance monitor as part of its $4.3 billion money laundering settlement.
- The monitorship was imposed after Binance admitted to AML control failures; it remains under separate Treasury FinCEN oversight.
- DOJ’s reassessment reflects broader shifts in enforcement policy emphasizing the burdens and benefits of monitorships.
- Binance’s founder served prison time, and the case has political undertones tied to crypto-friendly Trump administration policies.
- Final DOJ decision is pending, and enhanced reporting requirements may replace the monitor mandate.
- The outcome could shape future regulatory handling of compliance enforcement in cryptocurrency exchanges.
AML Editor’s article was originally published in seekingalpha on Sep. 16, 2025