Major cryptocurrency exchange Binance may pay a fine to settle an ongoing investigation by U.S. authorities, the Wall Street Journal quoted the company's chief strategy officer as saying.
According to Patrick Hillmann, the company is trying to close its early compliance loopholes and mistakes but regulators will likely require it to pay fines. This could be the exchange's way of wrapping up regulatory and enforcement investigations into its operations.
Hilman was cited by the WSJ as stating that, Binance is "working with regulators to figure out what are the remediations we have to go through now to make amends for that." [...] The outcome will be "likely a fine, could be more.… We just don’t know. That is for regulators to decide."
The company’s chief strategy officer believes that the above-mentioned gap has arisen due to Binance’s rapid growth, especially because the business was started by software engineers who did not understand the rules and laws to address risks such as bribery, corruption, money laundering and money laundering. economic sanctions.
Hillman was quoted as saying that the recent actions by US authorities will have "a really deep and lasting chilling effect" on the country.
Just this month, in a series of other related events, blockchain infrastructure platform Paxos announced that the SEC plans to take enforcement action against its Binance Dollar (BUSD) offering, while the New York State Department of Financial Services (DFS) ordered Paxos to Stop minting BUSD.
It was subsequently revealed that Circle, the U.S. payments company that issued the USD Coin (USDC) stablecoin, had alerted New York regulators that it had found discrepancies in blockchain data suggesting that Binance did not store enough cryptocurrency reserves to support the number of tokens it issued .
Additionally, in the first three months of 2021, more than $400 million allegedly flowed from California-based Silvergate Bank’s Binance.US account to trading firms linked to Binance CEO Changpeng Zhao (CZ), according to reports. Merit Peak. Binance. The U.S. spokesperson claimed that Merit Peak “neither trades nor provides any type of service on the Binance.US platform.” Notably, the SEC opened an investigation in February 2022 into the relationship between Binance.US and trading firms Sigma Chain AG and Merit Peak.
Earlier this year, U.S. authorities issued subpoenas to U.S. hedge funds and market makers who dealt with Binance earlier this year, demanding records of their communications with the exchange. Meanwhile, major cryptocurrency exchange Kraken agreed a few days ago to pay a $30 million fine to the U.S. Securities and Exchange Commission (SEC) in a settlement and end a civil investigation into its staking investment scheme, without admitting or denying Misconduct.
After Kraken reached an agreement with the SEC and decided to stop offering staking services or programs to U.S. customers, Coinbase CEO Brian Armstrong said his exchange's crypto staking services are not securities, adding that he is willing to fight in court. defended this.
