FTX Controversy Derails Top Law Firm’s Bid for Binance Role

The Department of Justice is retreating from picking an elite New York law firm for a key assignment overseeing cryptocurrency exchange Binance Holdings Ltd. because of its work for FTX, according to people with knowledge of the matter.

Sullivan & Cromwell was close to winning approval to serve as independent monitor for Binance on behalf of both the Justice Department and the Treasury Department’s Financial Crimes Enforcement Network, Bloomberg reported in February. The monitorships were a condition of the $4.3 billion deal by which Binance pleaded guilty to violating US money-laundering regulations and trade sanctions.

But Justice Department officials ...