Binance Has Quietly Offloaded Its Venture Capital Arm

Binance logo and crypto coins

Leading cryptocurrency exchange Binance has quietly set off its startup investing department, Binance Labs, as a separate company. The move comes amid regulatory efforts and changes in leadership at the cryptocurrency exchange.

Binance Labs is now an independent venture

The $10 billion venture unit Binance Labs now states on its website that it is “an independent venture and not part of the Binance Group.” The company, according to the statement, “is licensed by Binance to use its trademark but otherwise [has] no other relationship with the Binance Group.” The spinoff happened sometime early this year.

According to Bloomberg, Binance Labs’ personnel contract will now be distinct from that of the crypto exchange, allowing it to operate as an independent business entity. Binance’s venture capital section, managed by co-founder Yi He, has invested in over 200 cryptocurrency companies since 2018, including Aptos Labs, LayerZero, Polygon, and The Sandbox.

In regulatory crosshairs

Binance was founded in 2018 and is the world’s largest cryptocurrency exchange in terms of trading volume. However, due to its decentralized structure and lack of transparency on its headquarters, the exchange has regularly come under the scrutiny of the United States Securities and Exchange Commission (SEC) and other worldwide regulatory bodies.

Last year, the exchange made headlines when it resolved a $4.3 billion lawsuit with the US Department of Justice for breaching the US Bank Secrecy Act, which prohibits money laundering, and ended support for the Binance-branded stablecoin. It was one of the most significant business settlements in US history.

Leadership change, decisions change

Changpeng Zhao, Binance’s co-founder and former CEO, has been mired in controversy during his tenure. He pled guilty to deliberately breaking the Bank Secrecy Act and resigned in November 2023; the former chief is currently awaiting punishment, which is expected to entail jail time.

Richard Teng, Binance’s previous global head of regional markets, took over as CEO when Zhao stepped down. The recent move to split Binance Labs from its parent firm represents a significant shift under his leadership.

Author: Simeon

Simeon is a seasoned crypto writer with a passion for exploring the fascinating world of blockchain and digital currencies. With a background in finance and technology, Simeon brings a unique perspective to his writing, delving into the complexities of decentralized finance, cryptocurrency trading, and emerging blockchain projects.