April 15, 2024


Leading crypto exchange Binance has subtly spun off its venture capital arm, Binance Labs, as an independent entity. The decision has come amid regulatory actions and changes in leadership at the crypto exchange.

The $10 billion venture unit Binance Labs now writes on its website that it is “an independent venture and not part of the Binance Group.” The firm “is licensed by Binance to use its trademark but otherwise [has] no other relationship with the Binance Group.” The spinoff occurred at some point earlier this year.

Binance Labs’ staff contract will now be separate from that of the crypto exchange and it will work as an independent business unit, according to Bloomberg. The venture capital unit, led by Binance co-founder Yi He, has invested in more than 200 cryptocurrency projects since 2018, including Aptos Labs, LayerZero Labs, Polygon, and The Sandbox.

In regulatory crosshairs

Founded in 2018, Binance is the largest crypto exchange in the world by trading volume. But thanks to its decentralized structure and the lack of clarity over its headquarters, the exchange has frequently come under the lens of the U.S. Securities and Exchange Commission (SEC) and other global regulatory authorities.

Last year, the exchange was in the news when it settled a $4.3 billion lawsuit with the U.S. Department of Justice for violating the U.S. Bank Secrecy Act, which bars money laundering, along with terminating support for the Binance-branded stablecoin. It was one of the largest corporate settlements in U.S. history.

Leadership change, decisions change

Binance’s co-founder and former CEO Changpeng Zhao has been embroiled in controversy throughout his tenure. He pleaded guilty to willfully violating the Bank Secrecy Act and stepped down from his position in November 2023; the former chief is now awaiting sentencing, which is likely to include a jail term.

Binance’s former global head of regional markets, Richard Teng, took over as CEO following Zhao’s step down. The latest decision to detach Binance Labs from its parent company indicates a big change under his leadership.

Correction: An earlier version of this story misstated the name of one of the companies backed by Binance co-founder Yi He. It is LayerZero Labs, not LayerZero.



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