Richard Teng sits in an oak-colored conference room wearing a blue suit that, with his neatly-cropped salt-and-pepper, make him look every inch the banking regulator he used to be. The new CEO of Binance is friendly but cautious—a far cry from his predecessor, Changpeng Zhao, who last week agreed to step away from the company he founded as part of a $4 billion criminal settlement with the U.S. government.
While Teng's ascension to CEO has been in the works for months, the task ahead of him is enormous and would tax even the most seasoned senior executive. In the coming days, he must reinvent a corporate culture that has long been defined by Zhao—a charismatic outlaw, known universally as CZ, who delighted in trolling regulators and his critics with defiant social media posts. Meanwhile, Teng must also find a way to ensure that Binance, the world's biggest crypto exchange, can stay competitive as it navigates both a colossal financial sanction and a U.S. government monitor that will be embedded in its operations as part of the settlement.
Getting past Binance's 'missteps'
"Binance is a six year old company—it's a relatively young company by any measure. In human terminology, it's a child preparing to go into early school," says Teng in English that's fluent but that he learned as a second language in his native Singapore.
Teng adds that Binance is also at the stage of its evolution where it's pivoting from being an unruly tech startup into a conventional financial company. He admits that Binance made a number of "missteps" in its hypergrowth phase that saw it emerge from nowhere to become world's biggest crypto firm in the space of a year—but it has learned from them, he says.
Binance's many critics would likely use a harsher term than missteps to describe the company's behavior, which led both the firm and Zhao to plead guilty to money laundering and sanctions violations, and earn a televised rebuke last week from both the U.S. Attorney General and the Treasury Secretary. Teng, though, points out that the many allegations laid out in the settlement agreement do not include accusations that Binance misappropriated customer funds, and he touts the company's long track record of ensuring that assets on its platform stay secure.
Teng is also confident that he will be able to fill the shoes of Zhao, who is currently waiting to learn if he will have to serve prison time and who is barred from having anything to do with Binance in the next three years.
"I need to stress that I have the confidence and trust of CZ, the leadership team, and our staff members for me to lead this very important franchise going forward. And that confidence is very important. I think that transcends the responsibility of our 150 million users, and the livelihood of our thousands of employees," says Teng, adding that he has worked closely with Zhao since 2021 and learned from Zhao's focus on execution and strategy.
As he puts his own stamp on the job, Teng says the evolving role of the crypto industry—which is attracting unprecedented interest from mainstream financial firms like BlackRock and Fidelity—will play to his strengths.
Those strengths include experience advising Singapore's central bank and helping develop a new financial center in Abu Dhabi where he currently resides. Teng says one of his primary goals will be to help the crypto industry push for the adoption of harmonized global rules like those the banking industry has long enjoyed. This will include resolving the ongoing wrangling over whether various types of digital assets should be classified as a commodity or a security—or something else that reflects the distinct blockchain technology that underpins them.
Teng adds that the industry—and Binance—will benefit from his particular expertise. "I'm the sort of regulator that doesn't think you can regulate an industry effectively if you do not understand the industry. It's just like bankers or banking regulators that do not have a bank account."
Can Binance be transparent?
Teng's push for an industry focused on compliance and regulation will find support from others in crypto who have long despaired over the rampant fraud and deceit in their ranks—but it's also a far cry from Binance's longtime identity as a stateless, and often lawless, enterprise.
While Binance built a massive business and survived the fallout from FTX's collapse, which wiped out many other crypto firms, its workings have long been a black box. The company has never provided a full accounting of its assets and, under Zhao, radically disbursed its operations to the point where it claimed not to have a headquarters at all.
Asked if Binance will adopt a conventional corporate structure under his leadership, Teng says it will. He says it will include a board of directors, an address, and transparency when it comes to its finances.
"Once you have all those corporate structure in place, I think those financials will be what we'll be sharing. We've all known that auditors [require them], but the regulatory agencies will require all those things as well. So we are committed to transparency as an organization," said Teng.
Pressed for exactly when Binance will disclose the composition of its board and publish financial statements—in the way its rival Coinbase has for years—Teng declined to provide specifics, but said he has a "robust timeline."
In the meantime, Teng will also face pressure as more footloose—or outright criminal—customers flee for unregulated exchanges. Indeed, Binance has already seen nearly $1 billion in outflows since the settlement with the U.S. Justice Department, and it looks less dominant than it has for years. Reuters, citing stats from crypto firm CCData, reports that Binance last month controlled 32% of crypto spot and 50% of derivatives trading, down from 55% and 62% respectively in January.
Teng is taking these developments in stride, saying the outflows were predictable as Binance becomes what he says is the first exchange outside the U.S. to impose mandatory know-your-customer requirements on its user base. He added that the company has the resources to stay competitive even as it navigate new regulatory constraints and prepares to pay one of the largest corporate fines in U.S. history.
"We are starting from a position of strength. The fundamentals of the business are extremely strong. Our capital structure is debt free, expenses are models, and our revenue and profits remain robust," he said.
Teng predicts that Binance's effort to reinvent itself as a regulated company will pay off in the long run, positioning the company to claim its share of a growing pie as institutional money causes the share of individuals owning crypto to swell to 20% from around 5% today.
