Maria Irene
The recent civil complaint filed by the US Commodity Futures Trading Commission (CFTC) against Binance, one of the world’s largest cryptocurrency exchanges, has elicited a response from Changpeng Zhao, the founder of Binance. In his statement, Zhao expresses disappointment at the sudden filing of the complaint, despite the two-year cooperation between the CFTC and Binance.
The complaint alleges that Binance illegally allowed US residents to trade on its platform, failed to register with the CFTC, and manipulated the cryptocurrency market. In his response, Zhao refutes these claims and provides evidence of Binance’s compliance efforts.
One of the key points highlighted by Zhao is Binance’s use of technology to ensure compliance, including its mandatory KYC program and strict block on US users by nationality, IP, mobile carrier, device fingerprints, and more. According to Zhao, Binance is the first global exchange to implement a mandatory KYC program and has one of the highest standards in KYC and AML.
Zhao also emphasizes Binance’s commitment to transparency and cooperation with regulators and law enforcement, with more than 750 people in its Compliance teams, many with prior law enforcement and regulatory agency backgrounds. To date, Binance has handled 55,000+ law enforcement requests and assisted US law enforcement in freezing/seizing more than $125 million in funds in 2022 alone and $160 million in 2023 so far.
Binance.com holds the highest number of licenses/registrations globally, 16 and counting, and is well regarded by its user community, according to Zhao.
Regarding trading, Zhao states that Binance does not trade for profit or manipulate the market under any circumstances. While Binance does need to convert crypto from time-to-time to cover expenses in fiat or other crypto currencies, it has strict policies for employees to prevent them from actively trading, as well as prohibitions on trading in Futures and for anyone with access to private information.
Zhao himself observes these policies strictly and does not participate in Binance Launchpad, Earn, Margin, or Futures. Instead, he focuses on building a solid platform that serves Binance’s users.
In closing, Zhao assures Binance’s users of its commitment to compliance and collaboration with regulators and government agencies. While not perfect, Binance holds itself to a high standard and believes in doing the right thing by its users at all times.
The response from Binance’s founder underscores the importance of compliance in the cryptocurrency industry, as regulators continue to scrutinize the activities of exchanges and other players in the space. Despite the challenges, Binance remains steadfast in its commitment to providing a secure and compliant platform for its users.
