Team develops battery component designed to make lithium metal batteries safer and more powerful

Novel organic-inorganic composite electrolyte

Tsinghua University Press

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An asymmetric quasi-solid-state composite electrolyte was constructed by evaporation-induced self-assembly of 1D molecular brushes and 0D hairy ceramic nanoparticles, followed by in situ polymerization. The resulting ultrathin quasi-solid-state composite electrolyte delivers a high ionic conductivity and a lithium-ion transference number of 0.67, and enables lithium iron phosphate cells to operate for 200 cycles with 94% capacity retention at 0.5 C.

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Credit: Energy Materials and Devices, Tsinghua University Press

A research team has developed a new type of battery component that results in safer and higher-capacity batteries. It can improve lithium metal batteries’ safety, reliability, and electrochemical performance. Their work provides a feasible molecular engineering strategy for developing safe, high-performance lithium metal batteries.

 

This research was published in the journal Energy Materials and Devices on June 24, 2026.

 

“Simply put, we aimed to make a safer, thinner, and faster-charging lithium metal battery free of internal short-circuit risks,” said Yin Cui, Sun Yat-sen University. The development of electric vehicles and smart grids has led to a growing demand for batteries that are safer and have greater energy density. Traditional lithium-ion batteries cannot meet these needs. Lithium metal batteries can store far more energy than conventional lithium-ion batteries, but they are dangerous because lithium metal tends to form dendrites that can pierce the separator and trigger internal short circuits.

 

In recent years, scientists have explored solid-state composite electrolytes. These hold promise as electrolyte systems for solid-state lithium-metal batteries. However, their application in lithium-metal batteries has been restricted because of challenges, such as poor interfacial compatibility between different functional components, low ionic conductivity at room temperature, and difficulty in completely inhibiting the growth of lithium dendrites.

 

Quasi-solid-state composite electrolytes have distinctive multilayer architectures that allow function customization based on the cathode and anode requirements. Yet the current quasi-solid-state composite electrolytes lack the qualities needed to attract and guide the lithium ions. These electrolytes also work poorly in colder temperatures. There are still significant challenges in the current development of asymmetric quasi-solid-state composite electrolytes.

 

The research team set out to design a novel organic-inorganic composite electrolyte for longer-lasting, safer batteries. Their core goal was to develop an asymmetric quasi-solid-state composite electrolyte through evaporation-induced self-assembly of molecular brushes and hairy nanoparticles, followed by in situ cationic ring-opening polymerization. “This asymmetric electrolyte can not only achieve intimate interfacial contact with the cathode, but also effectively suppress lithium dendrites growth on the anode side, significantly improving the overall safety, reliability, and electrochemical performance of lithium metal batteries,” said Cui.

 

The team notes that constructing an asymmetric double-sided electrolyte represents an extremely practical route to developing safe and high-performance lithium metal batteries. Their ultrathin electrolyte (19 μm) has two different functional sides: a rigid ceramic-rich side blocking lithium dendrites physically and a flexible polymer composite side ensuring tight contact with the cathode. These polymer chains on the surface of nanomaterials can evenly distribute lithium ions and simultaneously speed up lithium-ion transfer.

 

“This design delivers three standout real-world advantages: great ionic conductivity, a high lithium-ion transference number, and stable long-cycle battery life,” said Cui.  By integrating 1D molecular brushes and 0D hairy ceramic nanoparticles, the team created a continuous 3D ion transport network. The new material they created helps the charged particles move much more efficiently. This molecular synergy is the core innovation behind their excellent electrochemical data.

 

The team’s study showed that designing unique asymmetric quasi-solid-state composite electrolytes via molecular engineering is a promising research direction to fundamentally promote lithium-ion conduction and stabilize the lithium anode. This method provides a viable strategy for the practical application of high-performance solid-state lithium-metal batteries.

 

Looking ahead, the team’s next step is to scale up this fabrication process and test the electrolyte in larger‑format batteries, not just coin cells. They also aim to further optimize the composition to boost ionic conductivity and verify long‑term stability under practical operating conditions, especially during fast charging. “Our ultimate goal is to enable practical, safe lithium metal batteries that outperform today’s lithium‑ion systems in electric vehicles, drones, and portable electronics, especially in cold climates where current batteries struggle. In the longer term, we hope this molecular self‑assembly approach can be adapted to other solid‑state battery chemistries, such as sodium or potassium, broadening the impact beyond lithium,” said Cui.

 

The research team includes Shenghao Lin, Yin Cui, Guofang Yu, Dongtian Miao, and Dingcai Wu from the School of Chemistry, Sun Yat-sen University, Guangzhou, China, and Ruliang Liu from the School of Chemistry and Materials Science, Guangdong University of Education, Guangzhou, China.

 

This research is funded by the National Key Research and Development Program of China; the National Natural Science Foundation of China; the Guangdong Major Project of Basic and Applied Basic Research; the Natural Science Foundation of Guangdong; the Fundamental Research Funds for the Central Universities, Sun Yat-sen University; the Science and Technology Program of Guangzhou; and the Guangdong Basic Research Center of Excellence for Functional Molecular Engineering. 

 

DOI Link:

https://doi.org/10.26599/EMD.2026.9370095

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Journal

Energy Materials and Devices

DOI

10.26599/EMD.2026.9370095 

Article Title

Asymmetric quasi-solid-state composite electrolytes via self-assembly of molecular brushes and hairy nanoparticles for dendrite-free lithium metal batteries

Activating interfaces for faster lithium transport in solid-state batteries

A dual-function interphase activator helps lithium ions move across garnet-polymer interfaces, offering a practical route toward safer high-energy lithium-metal batteries

Science China Press

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Activating interfaces for faster lithium transport in solid-state batteries

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Credit: ©Science Bulletin

Solid-state lithium-metal batteries are considered one of the most promising technologies for next-generation energy storage because they can potentially deliver high energy density while improving battery safety. Yet their practical development is still limited by a fundamental challenge: lithium ions must move efficiently across solid-solid interfaces, where contact, chemistry, and transport are often poorly matched.

This challenge is particularly important in polymer-ceramic composite solid electrolytes. Garnet-type LLZTO is known for its high lithium-ion conductivity and good chemical stability, while PVDF-based polymers provide flexibility and processability. However, combining the two materials does not automatically create a fast ion-transport network. LLZTO surfaces are easily covered by lithium carbonate and lithium hydroxide after air exposure, and these surface species hinder lithium-ion movement. Meanwhile, semicrystalline PVDF itself has limited lithium-ion conductivity at room temperature. These issues make the ceramic-polymer interface a major bottleneck for solid-state battery performance.

To address this problem, a research team led by Professor Renjie Chen at Beijing Institute of Technology developed an interphase activator strategy for PVDF-LLZTO composite solid electrolytes. Instead of treating ceramic surface modification and polymer ion transport as two separate problems, the strategy couples both processes through one additive.

In this study, SbF3 was used as a representative interphase activator. It performs two connected functions. First, it converts the native lithium carbonate and lithium hydroxide species on the LLZTO surface into a reconstructed Sb2O3/LiF-rich interphase. This reconstructed interphase provides a more favorable local environment for lithium-ion transfer at the garnet surface. Second, together with ion-conducting cellulose, SbF3 regulates the coordination environment in the PVDF-based polymer phase, reduces polymer chain ordering, and promotes faster lithium-ion coordination and decoordination.

Through this dual-function design, the optimized electrolyte, named FPIT-11, forms a continuous lithium-ion percolation pathway across the LLZTO bulk, the reconstructed interphase, and the polymer coating. Experimental characterizations and theoretical calculations show that the Sb2O3/LiF heterogeneous interface lowers the lithium-ion migration barrier, while the polymer phase becomes more disordered and more favorable for lithium-ion transport.

The optimized FPIT-11 electrolyte delivers an ionic conductivity of 6.7 × 10−4 S cm−1, a lithium-ion transfer number of 0.84, and a lithium-ion conductivity of 5.6 × 10−4 S cm−1 at 30 ℃. It also shows a wide electrochemical stability window of 5.25 V versus Li/Li+, indicating potential compatibility with high-voltage cathodes.

The electrolyte also demonstrates strong stability against lithium metal. Symmetric lithium cells using FPIT-11 cycle stably for nearly 2400 hours at 0.2 mA cm−2 and reach a critical current density of 3 mA cm−2 under 3 MPa pressure. Further interfacial analysis reveals the formation of a lithium nitride-rich multiphase inorganic interphase on the lithium-metal surface, which helps support stable lithium plating and stripping.

Full-cell tests further demonstrate the practical potential of this strategy. LiFePO4, NCM523, and lithium-rich manganese-based cathode cells using FPIT-11 show stable cycling performance at 30 ℃. In particular, NCM523-based solid-state cells maintain stable cycling for 770 cycles, while pouch-cell tests also show good operational stability and safety.

This work provides a new design principle for garnet-polymer composite solid electrolytes. By integrating ceramic surface reconstruction with polymer-phase transport activation, the interphase activator strategy offers a practical path toward solid-state lithium-metal batteries with improved ion transport, interfacial stability, and cycling performance.

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Journal

Science Bulletin

DOI

10.1016/j.scib.2026.06.039 

 

Nature's 3D printer: bristle worms form bristles piece by piece

Better understanding of this natural formation process offers potential for technical developments

UNIVERSITY OF VIENNA

 

IMAGE: 

LARVA OF THE MARINE ANNELID PLATYNEREIS DUMERILII, SCANNING ELECTRON MICROGRAPH (SIZE SCALE: 100ΜM)

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CREDIT: LUIS ZELAYA-LAINEZ, VIENNA UNIVERSITY OF TECHNOLOGY

A new interdisciplinary study led by molecular biologist Florian Raible from the Max Perutz Labs at the University of Vienna provides exciting insights into the bristles of the marine annelid worm Platynereis dumerilii. Specialized cells, so-called chaetoblasts, control the formation of the bristles. Their mode of operation is astonishingly similar to that of a technical 3D printer. The project is a collaboration with researchers from the University of Helsinki, Vienna University of Technology and Masaryk University in Brno. The study was recently published in the renowned journal Nature Communications. 

Chitin is the primary building material both for the exoskeleton of insects and for the bristles of bristle worms such as the marine annelid worm Platynereis dumerilii. However, the bristle worms have a somewhat softer chitin – the so-called beta chitin – which is particularly interesting for biomedical applications. The bristles allow the worms to move around in the water. How exactly the chitin is formed into distinct bristles has so far remained enigmatic. The new study now provides exciting insight into this special biogenesis. Florian Raible explains: "The process begins with the tip of the bristle, followed by the middle section and finally the base of the bristles. The finished parts are pushed further and further out of the body. In this development process, the important functional units are created one after the other, piece by piece, which is similar to 3D printing." 

A better understanding of processes such as these also holds potential for the development of future medical products or for the production of naturally degradable materials. Beta-chitin from the dorsal shell of squid, for example, is currently used as a raw material for the production of particularly well-tolerated wound dressings. "Perhaps in the future it will also be possible to use annelid cells to produce this material," says Raible. 
  
The exact biological background to this: so-called chaetoblasts play a central role in this process. Chaetoblasts are specialized cells with long surface structures, so-called microvilli. These microvilli harbor a specific enzyme that the researches could show to be responsible for the formation of chitin, the material from which the bristles are ultimately made. The researchers' results show a dynamic cell surface characterized by geometrically arranged microvilli.

The individual microvilli have a similar function to the nozzles of a 3D printer. Florian Raible explains: "Our analysis suggests that the chitin is produced by the individual microvilli of the chaetoblast cell. The precise change in the number and shape of these microvilli over time is therefore the key to shaping the geometric structures of the individual bristles, such as individual teeth on the bristle tip, which are precise down to the sub-micrometer range." The bristles usually develop within just two days and can have different shapes; depending on the worm's stage of development, they are shorter or longer, more pointed or flatter.

In addition to the local collaboration with the Vienna University of Technology and imaging specialists from the University of Brno, the cooperation with the Jokitalo laboratory at the University of Helsinki proved to be a great benefit for the researchers at the University of Vienna. Using their expertise in serial block-face scanning electron microscopy (SBF-SEM), the researchers investigated the arrangement of microvilli in the bristle formation process and proposed a 3D model for the synthesis of bristle formation. First author Kyojiro Ikeda from the University of Vienna explains: "Standard electron tomography is very labor-intensive, as the cutting of the samples and their examination in the electron microscope must be done manually. With this approach, however, we can reliably automate the analysis of thousands of layers." 

The Raible group is currently working on improving the resolution of the observation in order to reveal even more details about bristle biogenesis.

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JOURNAL

Nature Communications

Comparison between "biological" (left) and "technological" 3D printing (right).

CREDIT

Claudia Amort, Studio Amort

Different segments of the bristles of the marine annelid Platynereis dumerilii. 3D reconstruction from more than 1000 electron micrographs. Blade (left), blade with joint (center), shaft (right).

CREDIT

Ilya Belevich, University of Helsinki

DOI

10.1038/s41467-024-48044-3 

ARTICLE TITLE

Dynamic microvilli sculpt bristles at nanometric scale

ARTICLE PUBLICATION DATE

13-May-2024

CRYPTO CRIMINAL CAPITALI$M

Sam Bankman-Fried, the fallen wunderkind of cryptocurrency


By AFP
March 28, 2024

Samuel Bankman-Fried, founder and former CEO of FTX, faces a potential de facto life sentence after being found guilty of a massive fraud scheme 

- Copyright AFP SAUL LOEB
Thomas URBAIN

He was the face of cryptocurrency, and a young one at that — a media darling seemingly destined to unite the sector.

But the stunning rise of Sam Bankman-Fried and his FTX platform would be matched by an equally spectacular fall when it was revealed that billions of dollars of clients’ funds had been moved and spent without their consent.

After a jury in 2023 found him guilty of seven counts, a federal judge in New York sentenced Bankman-Fried on Thursday to 25 years for leading the fraudulent scheme.

Before it all came crashing down, the native Californian had amassed a fortune at one point estimated to be worth $26 billion. “Save for Mark Zuckerberg, no one in history has ever gotten so rich so young,” read a headline in Forbes, which put Bankman-Fried on its cover in October 2021.

In the span of a few months, the Massachusetts Institute of Technology graduate with a degree in physics had taken the startup he co-founded in 2019 and built it up into the world’s second largest crypto exchange platform.

He quickly became more than just a young entrepreneur, fashioning himself as an ambassador of crypto and making his first appearance in Congress in December 2021, testifying before lawmakers on the then-novel form of currency.

The public would come to know a seemingly oddball whiz kid with a mop of curly dark hair who, when not suited up for appearances on Capitol Hill, wore shorts and a T-shirt.

– Center of crypto world –

The son of two Stanford University professors, Bankman-Fried ventured outside the world of cryptocurrencies, making donations to US politicians and persuading celebrities like American football star Tom Brady or basketball player Stephen Curry to pitch FTX — endorsements for which they were richly rewarded.

The young man known as SBF would charm US lawmakers with his straight talk and vision of crypto’s future, including recommendations for an extensive regulatory regime — a position at odds with many in the sector.

He devised project after project, from a platform for people to make donations in cryptocurrency to Ukraine to a market for financial derivative products that stepped on the toes of Wall Street.

A vegan, Bankman-Fried said he believed in the concept of effective altruism — finding the best way to help other people, in particular by donating all or part of one’s wealth to charity rather than, say, volunteering at a soup kitchen.

When the cryptocurrency world lurched into crisis in the spring of 2022, Bankman-Fried billed himself as a savior, buying the troubled platform BlockFi, and shares in another company that was in trouble, Voyager.

“We take our duty seriously to protect the digital asset ecosystem and its customers,” he tweeted at the time, as some people were comparing him — barely 30 years old then — to the legendary investing guru Warren Buffett.

– Financial high wire –

But behind his reassurances, Bankman-Fried was walking a financial high wire, as revealed later in court documents and testimony.

Without their knowledge, Bankman-Fried’s team used the money of FTX customers to cover risky operations by an affiliated trading company called Alameda Research, as well as to buy posh real estate and to make political donations.

In November 2022, the crypto news outlet CoinDesk revealed that Alameda had converted a large part of its assets into FTT, a crypto token created by FTX. The news caused that currency to plummet.

Hours later Changpeng Zhao, the head of Binance, the world’s largest crypto exchange platform, announced it was selling all the FTT tokens it held, causing it to lose 90 percent of its value in a matter of days and taking the Bankman-Fried empire with it.

His fortune having vanished overnight, Bankman-Fried was extradited from the Bahamas, where FTX had its headquarters. In December 2022 he was indicted on charges of fraud and racketeering.

After five weeks of trial, the jury quickly reached a guilty verdict on all seven counts, which carry a potential maximum sentence of 110 years behind bars.

In closing arguments, the defense said their client had acted in “good faith” and was overtaken by circumstances and the financial ineptitude of close associates who testified against him to gain leniency from prosecutors.

Prosecutors portrayed the defendant as an extremely smart man consumed by greed who knew what he was doing when FTX funds were secretly funneled to his personal hedge fund.

According to prosecutors, at the time of the bankruptcy of FTX, just over $8 billion belonging to customers had vanished into bad investments at Alameda.

“Who had control? That’s the question. It was one person: the defendant,” the lead prosecutor concluded.

 

Auto parts supplier Forvia to cut staff in Europe

By

 AFP

French-German auto parts manufacturer Forvia announced plans to cut 13 percent of its workforce in Europe over the coming years in an effort to boost competitiveness and profitability in a sluggish and shifting car market.

The company, created in 2022 from the merger of France’s Faurecia and Germany’s Hella, returned to profit in 2023 but unveiled the plan to achieve 500 million euros ($540 million) in savings by 2028.

Forvia’s announcement follows job cuts announced by a number of its rivals as suppliers adjust to an auto industry that has yet to fully recover from the Covid pandemic but is also in the midst of shifting to electric vehicles that will eliminate the need for certain products like mufflers.

Forvia’s management said up to 10,000 of its 75,500 posts in Europe could go by 2028, with a lower recourse to interim staff and the use of Artificial Intelligence to optimise research and development.

In addition to France and Germany the company also has sites in the Czech Republic, Poland and Spain.

“All sites will be affected but not in the same manner,” Forvia’s chief operating officer Olivier Durand said at a news conference.

“We’ve had a drop in the European market and we don’t see an improvement in the short or medium term,” said Durand, adding that certain of Frovia’s facilities are not working at full capacity.

“Our industry shifts regularly and we know how to adjust our industrial capacity,” he added.

The plan also aims to make Forvia less dependent upon China, where it makes 27 percent of its sales but most of its profits.

The company posted a net profit of 222 million euros in 2023, with sales rising nearly 11 percent to 27.2 billion euros.

Forvia, which took on debt as part of its merger with Hella, reduced its debt by nearly one billion euros last year to nearly seven billion.

Investors welcomed the company’s announcement with Forvia’s shares rising 4.7 percent in early trading while the Paris SBF 120 index slid 0.3 percent lower.

 

Study on lamprey embryos sheds light on the evolutionary origin of vertebrate head

Scientists study developing lamprey embryos to clarify the origin of vertebrate head, paving the way to a better understanding of ancestral vertebrates

Peer-Reviewed Publication

UNIVERSITY OF FUKUI

 

IMAGE: 

THESE PRIMITIVE JAWLESS FISH COULD HOLD CLUES TO THE EVOLUTIONARY ORIGIN OF VERTEBRATE HEADS, AS EVIDENCED BY DETAILED EMBRYOLOGICAL ANALYSES.

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CREDIT: TAKAYUKI ONAI FROM UNIVERSITY OF FUKUI

The origin of the vertebrate skull is a topic of much debate among evolutionary biologists. Some believe that the vertebrate head has developed as a result of modification of the segmental elements of the trunk, such as the vertebrae and somites. On the other hand, others believe that the vertebrate head has evolved as a new, unsegment body part, unrelated to other widely observed embryonic segments somites. Interestingly, previous studies on embryos have revealed the presence of some vestiges of somites in the head mesoderm (e.g., head cavities and somitomeres). However, homology between trunk somites and such head segments has been controversial.

The failure to understand the evolutionary origins of the vertebrate head is also attributable to the lack of studies on extant species such as lampreys, which are known to share several traits with fossil jawless vertebrates and retain primitive traits related to the head mesoderm. While some studies have focused on the embryonic morphology of lampreys, they have often fallen short because of challenges like tissue destruction and acidic fixation during examination, making it difficult to observe the formation of head mesoderm and trunk somites.

Now, however, a research team led by Assistant Professor Takayuki Onai from the University of Fukui, Japan, has utilized advanced techniques like transmission electron microscopy and serial block-face scanning electron microscopy (SBF-SEM) to understand the development of the head mesoderm and somites in lamprey embryos. The researchers also analyzed the morphology and gene expression patterns of cephalochordate and hemichordate (both being invertebrates) to understand the origins of somites and head mesoderm from an evolutionary perspective. This paper was made available online in iScience on November 13, 2023, and is co-authored by Dr. Noritaka Adachi from Aix-Marseille Université, Dr. Hidetoshi Urakubo from the National Institute for Physiological Sciences (NIPS), Dr. Fumiaki Sugahara from Hyogo Medical University, Dr. Toshihiro Aramaki from Osaka University, Dr. Mami Matsumoto from NIPS and Nagoya City University, and Dr. Nobuhiko Ohno from NIPS and Jichi Medical University.

To clarify the presence or absence of somites in the head mesoderm during early stages of diversification, the researchers focused on rosettes, which are major somite patterns and are important for the subsequent development of vertebrae. Their initial observations of lamprey embryos showed that the tissue closely related to the formation of facial muscles and other elements of the skull, known as the head mesoderm, did have cell clusters with features similar to somite rosettes. To clarify if these cell clusters were indeed rosettes, they conducted ultrastructural experiments, including the SBF-SEM and gene expression analysis. This examination of the cellular morphology and gene expression revealed that the cell clusters were clearly distinct from rosettes. “The cell clusters we observed are likely lamprey-specific features, as they are not recognizable in the head mesoderm of both hagfish and shark embryos,” explains Dr. Onai.

Furthermore, gene expression analysis also revealed the absence of segmental expression of somitogenesis-related genes, indicating their distinctiveness from somites. These findings indicate that the rosette pattern typically seen in somites is not necessarily the essential or most basic feature that defines the process of bodily segmentation.

Moreover, the experiments provide evidence that the vertebrate head mesoderm diverged during the early phases of vertebrate evolution. Furthermore, comparison of embryos of hemichordates (a basal deuterostome), amphioxus (a basal chordate), and vertebrates revealed that the somites likely arose from the “endomesoderm” tissue of an ancient deuterostome ancestor. The evolutionary origin of somites has been the central question in zoology for more than 150 years, and in this study, Onai et al., revealed the enigma. Regarding the evolutionary mechanism for the emergence of head mesoderm, they found that the head mesoderm emerged upon the segregation of mesodermal genes between the front and back parts (rostro-caudal axis) of organisms.

“Taken together, our findings revealed a different evolutionary origin for the vertebrate head mesoderm, suggesting that it evolved from the repatterning of an ancient mesoderm and diversified even before the emergence of jawed vertebrates,” concludes Dr. Onai.

In summary, the finding that the cell clusters present in the head mesoderm are distinct morphologically and molecularly from somites, favors a new model where the vertebrate head mesoderm diverged during early evolution. This sheds more light on the age-old debate on the evolution of the vertebrate head and can help us advance the understanding of our own origins.

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JOURNAL

iScience

DOI

10.1016/j.isci.2023.108338 

METHOD OF RESEARCH

Experimental study

SUBJECT OF RESEARCH

Animals

ARTICLE TITLE

Ultrastructure of the lamprey head mesoderm reveals evolution of the vertebrate head

CRYPTO CRIMINAL CAPITALI$M

CFTC says access to US customers 'is a privilege, not a right,' in aggressive case against Binance that is only just getting started

Laila Maidan
Thu, November 23, 2023 

CFTC says case against Changpeng Zhao and Binance is the beginning of an aggressive pursuit.

Commissioner Caroline D. Pham said the CFTC has no borders when it comes to prosecuting non-US entities.

Binance and Zhao to pay $4.3 billion in fines.

The last couple of years have been tough for the crypto industry and its leading figures.

And it's not likely there will be relief for the sector anytime soon. At least, that's what policymakers are signaling.

This week, Binance chief Changpeng Zhao joined his former industry rival Sam Bankman-Fried in making headlines for charges against him and his crypto exchange, which included breaching US anti-money-laundering laws.

On Tuesday, Zhao pleaded guilty and left his role as CEO. Binance is set to pay over $4.3 billion in fines, $50 million of which will be paid by the former CEO himself. A portion of that will go to settle claims made by the Commodity Futures Trading Commission for allowing US customers to trade unregistered crypto derivatives.

A statement made by CFTC Commissioner Christy Goldsmith Romero read: "There are no pirate ships in US markets" and that "access to US customers is a privilege, not a right."

Goldsmith added that the CFTC plans to continue its aggressive pursuit of crypto exchanges that violate trade laws.

The commissioner noted that there will be no tolerance for using VPNs, or any other actions that could circumvent KYC rules, including pop-up questions that merely ask users to attest that they aren't based in the US.

In a separate statement, CFTC Commissioner Caroline D. Pham said the CFTC's reach has no border. "It should be crystal clear that the CFTC will not stop in its pursuit of non-U.S. entities," Pham said.

The swift action comes amidst a prolonged case set against FTX-founder SBF, who pleaded not guilty and was charged with seven felony counts, including conspiracy to commit money laundering. He remains at New York's Metropolitan Detention Center awaiting his sentencing. He could face up to 110 years in prison.

Binance users pull $956 mln as Zhao steps down
Reuters Videos
Thu, November 23, 2023 

ORY: Investors pulled about $956 million from crypto exchange Binance within 24 hours, according to market data.

That was after its chief, Changpeng Zhao, pleaded guilty on Tuesday to settle a years-long U.S. illicit finance probe.

He stepped down from the company and now faces prison time - although it remains unclear how much.

Binance will pay $4.3 billion to U.S. authorities, which raises questions over the future of the world's largest crypto exchange.

The development also represents another blow for an industry beset by scandals.

Authorities said Binance failed to report more than 100,000 suspicious transactions.

This included organizations the U.S. described as terrorist groups.

Market data platform Nasden said despite the amount of money pulled, over $65 billion of assets remain on Binance.

But some analysts said the deal was unlikely to end Binance's U.S. legal woes, with charges by the Securities and Exchange Commission still unresolved.

Binance did not immediately respond to a request for comment, but said this week it had worked hard to make the exchange "safer and even more secure."

Ex-Binance CEO Zhao urges judge to allow him to leave US before sentencing

Updated Fri, November 24, 2023 

By Nate Raymond

(Reuters) - Lawyers for former Binance CEO Changpeng Zhao are urging a U.S. judge to reject the Justice Department's request to bar him from returning to his home in the United Arab Emirates until he is sentenced for violating anti-money laundering requirements.

Zhao's lawyers in a Thursday filing asked U.S. District Judge Richard Jones in Seattle not to reverse bail conditions set by a magistrate judge on Tuesday that would allow him to leave the U.S. while awaiting sentencing.

Zhao, a citizen of the UAE and Canada, stepped down as CEO of Binance on Tuesday after pleading guilty to willfully causing the global cryptocurrency exchange to fail to maintain an effective anti-money laundering program.

U.S. authorities said Binance broke U.S. anti-money laundering and sanctions laws and failed to report more than 100,000 suspicious transactions with organizations the U.S. described as terrorist groups including Hamas, al Qaeda and the Islamic State of Iraq and Syria.

The company as part of a plea deal agreed to pay more than $4.3 billion. Zhao has agreed to pay a $150 million penalty to the U.S. Commodity Futures Trading Commission, and prosecutors in a Wednesday filing said he faces up to 18 months in prison.

The Justice Department has asked Jones by Monday to reverse a decision by U.S. Magistrate Judge Brian Tsuchida to allow Zhao to return home to the UAE ahead of his Feb. 23 sentencing after he agreed to release him on a $175 million bail bond.

The government said it may be unable to secure his return if he chooses not to come back to the U.S. for sentencing, given that it has no extradition treaty with the UAE and Zhao is a multi-billionaire with significant assets.

But Zhao's lawyers argued that the former CEO had demonstrated he was not a flight risk by agreeing to a "substantial" bail package and by voluntarily coming to the U.S. to accept responsibility for his actions.

Allowing Zhao to return to the UAE would allow him to take care of his partner and three children and prepare them for his sentencing, defense lawyers argued.

The Justice Department responded in a brief on Friday that its decision at Tuesday's hearing to recommend Zhao remain free before sentencing was "exceptional" and was only because it believed the risk of flight he posed could be "managed" by restricting his travel.

"In the vast majority of cases, a multi-billionaire defendant who has pleaded guilty, faces possible prison time, and lives in a country that does not extradite its citizens to the United States would be detained," Justice Department lawyers said.

(Reporting by Nate Raymond in Boston; Editing by Alexia Garamfalvi, Marguerita Choy and Daniel Wallis)

Analysis-Binance CEO Teng braced for uphill battle in post-Zhao era

Fri, November 24, 2023 


By Tom Wilson and Elizabeth Howcroft

LONDON (Reuters) - Spiralling compliance costs, ongoing legal headaches and a shrinking share of the market: Binance's new chief Richard Teng faces daunting challenges in turning a new leaf for the world's biggest crypto exchange.

Teng was quickly appointed CEO this week after Binance's founder Changpeng Zhao pleaded guilty to breaking U.S. anti-money laundering laws, part of a $4.3 billion deal to resolve a years-long U.S. investigation.

Now Teng must deal with years of intrusive U.S. financial monitoring, an ongoing U.S. Securities and Exchange Commission (SEC) lawsuit and the potential loss of its dominance of the crypto sector, analysts, investors and former regulators said.

Teng faces an especially tough task in transforming the culture of Binance, four of the people said. U.S. Treasury Secretary Janet Yellen said on Tuesday that Binance "turned a blind eye to its legal obligations in the pursuit of profit" as it "allowed money to flow to terrorists, cybercriminals, and child abusers."

Teng, who before working for Binance was a financial regulator, said on social media that he would focus on reassuring users of Binance's "financial strength, security and safety" and collaborate with regulators "to uphold high standards globally."

"Teng is seen as steady hands," said Carol Alexander, professor of finance at the University of Sussex, who has tracked Binance for years. Still, leading a cultural shift at Binance - a firm shaped by Zhao in his own image - would be "hugely difficult," she said. Investors pulled almost $1 billion from Binance in the 24 hours after Zhao's demise, among its biggest daily outflows of the last year. The reaction is a sign of the challenges ahead for Teng, who previously ran Binance's regional markets.

While the U.S. settlement bars Zhao from future involvement in operating or managing Binance, he is still a major shareholder. Yi He, Binance's co-founder and the mother of Zhao's children, remains a top executive at the company. "New page," she posted on Tuesday.

Contacted by Reuters with a summary of this article, Binance did not make Teng available for an interview.

Binance spokesperson Simon Matthews told Reuters that Binance had lacked "compliance controls adequate for the company that it was quickly becoming" and made "misguided decisions" as it grew quickly.

"Richard was hired two years ago to help Binance mature and move past these historical issues," Matthews said, adding that Binance had "worked hard to restructure our organization and personnel and upgrade our systems." The firm has "new leadership" in place with experience in compliance, law enforcement and major corporations, he added.

Zhao's lawyers did not respond to a request for comment.

MONITORSHIP

As part of the resolution, the U.S. authorities will subject Binance to five years of "financial monitorship" overseen by the U.S. Treasury's Financial Crimes Enforcement Network (FinCEN).

FinCEN will keep access to Binance's books, records and systems, "oversee remedial undertakings" needed to address Binance's non-compliance with anti-money laundering and sanctions rules, the Treasury said on Tuesday.

Such steps are unusual, challenging and costly, even for mainstream financial companies with deep experience of dealing with regulators, said lawyers and former regulators.

"It's a real millstone - everything you are doing is subject to scrutiny," said John Reed Stark, a former chief of the SEC's Office of Internet Enforcement.

While the exchange has said it has ramped up compliance spending, Zhao for years sought to shield it from regulators, Reuters reported in a series of articles in 2022.

Still, Binance should be able to cover both additional compliance costs and the U.S. fines, investors have said.

"The fundamentals of our business are VERY strong," Teng posted on social media on Wednesday. "Our capital structure is debt-free, expenses are modest, and, despite the low fees we charge our users, we have robust revenues and profits."

HIRED BY ZHAO

Hired by Zhao as Binance's Singapore chief in 2021, Teng has been CEO of Abu Dhabi Global Market from 2015 to 2021. His previous roles included chief regulatory officer at Singapore Exchange (SGX).

He was promoted to head Binance's regional markets in May and was widely seen as a potential successor to Zhao.

His rise to the top job is for Binance "an opportunity to move past mounting enforcement actions and chart a path towards stability and a fresh beginning," said Rajeev Bamra, head of digital assets strategy at Moody's Investors Service.

Complicating prospects for a clean slate, however, are outstanding legal headaches.

Binance is facing an SEC lawsuit for allegedly operating a "web of deception," including artificially inflating its trading volumes and diverting customer funds. Binance has denied the allegations.

It is also under investigation in France for alleged aggravated money-laundering.

On the business front, too, Binance is under pressure.

For years it dominated the crypto market, but this year has rapidly lost market share. Last month it controlled 32% of crypto spot and 50% of derivatives trading, according to crypto firm CCData, down from 55% and 62% respectively in January.

Fuelling the decline has been an end to Binance's zero-fees transaction promotions, as well as its regulatory problems, analysts said.

Other exchanges, such as Seychelles-registered OKX, have gained market share this year, according to CCData. OKX is the second-largest exchange after Binance by market share.

In the longer term, the exchange may lose further market share because of reduced marketing and business development budgets following the U.S. fines, said Joseph Edwards, head of research at London crypto firm Enigma Securities.

"But that's talking quite far down the line - they are a very strong incumbent overall."

(Reporting by Tom Wilson and Elizabeth Howcroft; editing by Elisa Martinuzzi and Louise Heavens)

Binance to pay $4.3 billion in fines for money laundering violations

Ryan General
Thu, November 23, 2023



[Source]

Binance is set to pay an unprecedented $4.3 billion in fines and restitution after pleading guilty to money laundering violations, federal authorities announced.

Settlement details: The settlement involves agreements with the Justice Department, the Treasury Department and the Commodity Futures Trading Commission (C.F.T.C.), which all started their investigation on Binance years ago, according to The New York Times.

As part of the deal, Binance will pay $1.81 billion within 15 months and a further $2.51 billion forfeiture. Founder Changpeng Zhao, who also pleaded guilty, has agreed to a $50 million fine and to step down as CEO.


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Evading laws: According to court documents, Zhao and senior Binance employees were involved in a wide-ranging scheme to avoid complying with regulations requiring financial institutions. This includes evading laws on identifying customers' true identities, refraining from doing business with criminals and registering U.S.-based businesses with regulators. It was revealed that customers from sanctioned countries — including Cuba, Iran and Syria — were able to access the Binance platform.

Failure to institute proper controls: Treasury officials highlighted Binance's failure to report suspicious transactions involving terrorist groups such as Hamas, Al Qaeda and ISIS, reported Reuters. The court filings also revealed that Binance conducted business with U.S.-based firms, violating anti-money laundering laws that required a separate platform, Binance.US, to handle such transactions.

Zhao’s future: Zhao's bail was set at $175 million, secured by $15 million in cash. Despite stepping down as Binance's CEO, he will retain a presence as a major stakeholder. However, his future remains uncertain, with his sentencing set for Feb. 23, 2024. While he faces up to 18 months in prison, prosecutors are moving for a stiffer penalty.

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Regulatory scrutiny: Regulatory actions against Binance began earlier this year, with the C.F.T.C. filing a civil suit in March, followed by the S.E.C. charging Binance and Zhao with mishandling customer funds and providing false information to regulators. The S.E.C. is not a party to the recent settlement.

The penalty imposed on Binance is one of the largest ever by the U.S. government against a financial firm. The plea deal appears to give Binance the opportunity to continue its operations under the oversight of a government monitor.