financial system from illicit finance, provides for jail terms of up to 10 years. This requires crypto exchanges to register with the Treasury Department and comply with anti-money laundering requirements if they conduct "substantial" business in the United States. authorities, the people said, are investigating whether Binance violated the Bank Secrecy Act. financial crime laws that remains ongoing, four people familiar with the inquiry said. The December 2020 request, which has not been previously reported, was part of a Justice Department investigation into Binance's compliance with U.S. Personal Loans for 670 Credit Score or Lower Personal Loans for 580 Credit Score or Lower Hundreds of thousands of investors are filing a $20 million class action lawsuit against the exchange for the serious crash that hit the platform on 19 May, preventing many traders from liquidating their positions during a market crash.Best Debt Consolidation Loans for Bad Credit Many doubts remain about its transparency and security, despite the reassurances the company continues to give its users. In 2020, Binance generated about $900 million in profits and among the goals of its ambitious founder is to list the exchange on the Nasdaq within three years, a goal that will be difficult to achieve without addressing the issue of transparency and regulation of the exchange itself.īinance’s great success is mainly due to its much lower commission policy compared to other exchanges such as Kraken or Coinbase, and its wide range of additional services, such as cryptocurrency lending, in exchange for a commission. But its founder has always said that in reality Binance has no headquarters. This inevitably raised many doubts about its regularity and transparency, as it was based in a well-known tax haven. On 14 September, the large Chinese exchange hit a volume record of $30 billion, confirming its role as the world’s top exchange.įounded in 2017 in China by Changpeng Zhao and Yi He, it has since changed its registered office to the Cayman Islands to avoid restrictive cryptocurrency laws by Chinese authorities. Regulators in Italy, Canada, Thailand, Japan and South Korea have also restricted or prohibited Binance from offering certain services in their respective countries. The FCA accused Binance Market Limited, the UK division of the exchange, of not having any kind of authorization to offer certain financial services. In the UK, authorities in June banned the UK division of the exchange from operating in the country. It isn’t only in the US that Binance has been under the spotlight of regulators and judges for some time. Th e CFTC had already been investigating the Chinese exchange for weeks, because it allowed US residents to buy and sell derivatives linked to Bitcoin and other virtual tokens, without having the necessary authorization. In the US, the Department of Justice opened an investigation in May for money laundering and tax evasion. This is not the first investigation by regulators that the world’s most popular cryptocurrency exchange has faced. Authorities worldwide are paying attention on Binance All the problems with Binance’s regulators
The company said this in a statement to financial newspaper Business Insider, but would neither confirm nor deny the news reported by Bloomberg.
Binance investigation code#
“At Binance, we have a zero-tolerance policy for insider trading and a strict ethical code related to any type of behavior that could have a negative impact on our customers or industry” The Commodity Futures Trading Commission, which oversees derivatives trading, is said to be participating in the investigation and has already called witnesses. SEC putting Binance under investigation due to improper use of data?Īccording to anonymous sources, the authority supervising the American stock exchange has accused the exchange of using data and information on the trading activity of its users to carry out operations on the markets for its own purposes.
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