• The US Commodity Futures and Trading Commission (CFTC) has filed a complaint against Binance and its co-founder Changpeng Zhao, alleging that the exchange has actively solicited users from the United States and undermined its own compliance program.
• According to the filing, Binance has failed to register with the CFTC and disregarded U.S. financial market laws designed to prevent illicit activities such as money laundering and terrorism financing.
• Furthermore, it is alleged that Binance engaged in trading on their own platform through 300 accounts directly or indirectly linked to their CEO CZ.
Binance Faces Legal Action by U.S. CFTC
Binance, one of the world’s largest cryptocurrency exchanges, is facing legal action from the US Commodity Futures Trading Commission (CFTC). The agency has filed a complaint alleging that Binance actively solicited users from the United States and undermined its own compliance program while failing to register with the CFTC and disregarding U.S. financial market laws designed to prevent illicit activities such as money laundering and terrorism financing.
Alleged Derivatives Trading Violations
The complaint further alleges that Binance engaged in trading on their own platform through 300 accounts either directly or indirectly linked to their CEO CZ, resulting in an increase in revenue from derivatives transactions from $63 million in August 2020 to $1.14 billion by May 2021 – 16% of which were held by customers based in the United States.
Changpeng Zhao Facing Legal Action
In addition to facing legal action for violating regulations on trading and derivatives, Changpeng Zhao – co-founder of Binance – is also being sued by the CFTC for allegedly seeking to attract profitable „VIP“ clients including institutional customers based in America without properly supervising his activities or those of his company..
Increased Regulatory Scrutiny
The regulatory concerns regarding Binance’s crypto business have been increasing due to increased scrutiny from authorities around the world; raising FUD among investors about potential consequences for illegal activity associated with crypto exchanges like Binance..
As more details about this case come out into public knowledge, investors should remain vigilant about any potential changes or developments that could affect their investments on platforms like Binance or other exchanges regulated by authorities worldwide..