Binance's agreement with the U.S. Department of Justice (DOJ), disclosed on December 8, brings into focus extensive government oversight over the operations and business activities of the cryptocurrency exchange, possibly leading to its closure.
Outlined in an 11-page document, Binance's new responsibilities include providing access to documents, records, and resources upon authorities' request, encompassing information related to past employees, agents, intermediaries, consultants, representatives, distributors, licenses, contractors, suppliers, and joint venture partners, as highlighted in the analysis.
Multiple divisions within the U.S. Department of Justice's Criminal Division, such as the Money Laundering and Asset Recovery Unit, National Security Unit, Counterintelligence and Export Control Unit, and the U.S. Attorney’s Office for the Western District of Washington, will closely oversee Binance's activities. Additionally, the exchange will undergo five years of supervision by the Financial Crimes Enforcement Network (FinCEN). The increased regulation may lead to substantial financial burdens for Binance.
Describing the settlement's implications, it was noted that Binance will be subjected to continuous surveillance and audits, exposing both the company and its customers to persistent oversight and scrutiny.
Binance and its former CEO, Changpeng Zhao, acknowledged violating U.S. laws on money laundering and terrorist financing, agreeing to pay a hefty $4.3 billion fine on November 21. The recent unsealing of court records forms part of new SEC filings, strengthening the SEC's case against Binance and Zhao.
The Securities and Exchange Commission (SEC) filed 13 charges against Binance on June 5, alleging unregistered offerings and sales of tokens, staking plans, and failure to register Binance.com as an exchange. The SEC's latest filing seeks judicial attention to the facts presented in the Binance settlement, aiming to challenge the exchange's dismissal motion, thereby contesting Binance's operations in the U.S. in recent years.
A settlement with the U.S. Department of Justice earlier confirmed that Binance had over 3 million U.S. customers by March 2018, and approximately 30% of Binance's web traffic came from the United States as of June 2019.
