The world-famous Binance cryptocurrency platform, and its founder and CEO, Chengpeng Zhao, known as CZ, is facing a lawsuit in America on charges of willfully defrauding US laws, filed by the US Commodity Futures Trading Commission (CFTC), Monday, according to Reuters.
Electronic encryption companies are exposed to a lot of legal accountability recently, he said International Monetary Fund In a January blog post he said the cryptocurrency market “needs strong and comprehensive regulation and oversight” globally.
According to what was published by Reuters on Tuesday, the crypto market benefited from the recent banking sector crisis in America despite liquidity risks, and Bitcoin, the most popular among cryptocurrencies, suddenly rose by 40% to about $27,700 since the Silicon Valley crisis erupted on March 10, 2023.
The CFTC is responsible for overseeing the commodity and derivatives markets, including Bitcoin. According to Reuters, companies such as brokers who facilitate US clients’ trading of these products are required to register with them.
The lawsuit notes that Binance – with a trading volume of $34 trillion in 2021 – did not require customers to provide information to verify their identity before trading and “failed to implement basic compliance procedures designed to prevent and detect terrorist financing and money laundering,” according to the agency.
According to information Reuters says it has obtained, the Binance platform has processed at least $10 billion in payments for criminals and companies seeking to evade US sanctions.
In a statement on Binance on Monday, Zaw said, “The complaint is unexpected and disappointing,” adding, “We do not agree with the characterization of several of the alleged issues in the complaint.”
He said his company does not trade for profit or “manipulate” the market under any circumstances.
And last year, Binance backed out of a deal to acquire the “FTX” platform, which declared bankruptcy, while the sector witnessed a violent shock as a result of the crisis.
Binance obtained approval from the Dubai Virtual Asset Regulatory Authority to launch a “minimum product”. after obtaining a temporary license In March 2022.
Binance also got License from Bahrain It allows crypto-asset trading, custody services, and portfolio management for clients, with oversight from regulators.
For more: Tulip Madness: Why is Dubai the Right Place for Cryptocurrency Companies?
(Prepared by: Shaima Hefzy, contact zawya.arabic@lseg.com)
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